Greenmail, which is like blackmail, occurs when:

Question

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Greenmail is like blackmail in which a potential acquirer buys a block of stock in a company, and the target company's management becomes afraid that the acquirer might make a tender offer and gain control of the company. To prevent a possible takeover, the management may offer to pay greenmail, which involves buying the stock owned by the potential raider at a price above the existing market price. Therefore, all of the given options are correct.

Greenmail, Which Is Like Blackmail, Occurs When