A public offer by one ﬁrm to directly buy the shares of another ﬁrm is called a ____________.
A) Merger.
B) Consolidation.
C) Tender offer.
D) Spinoff.
E) Divestiture.

Question

Quizplus · Accepted Answer

A tender offer is a public offer by one firm to directly buy the shares of another firm. A merger is the combination of two companies into a single entity. Consolidation is similar to a merger, but it involves more than two companies. A spinoff is when a company creates a new, independent company out of a division or subsidiary. Divestiture is when a company sells off a portion of its assets, subsidiaries, or divisions. None of these options match the definition of a tender offer.

A Public Offer by One ﬁRm to Directly Buy the Shares