When investors successfully take a firm private, the firm's stock is:
A) converted into bonds.
B) converted into cash.
C) no longer sold to investors on the open market.
D) pledged as collateral to its bondholders.

Question

Quizplus · Accepted Answer

When a firm is taken private, its stock is no longer sold to investors on the open market. This means that the company is no longer a publicly traded entity and its shares cannot be bought or sold by investors on stock exchanges. Instead, ownership is concentrated among a small group of investors, which often includes private equity firms and/or the company's management team.

When Investors Successfully Take a Firm Private, the Firm's Stock