ABC Company wished to acquire EFG CompanyABC Company wished to acquire EFG Company. An analysis of the merger passed the better-off test but failed the ownership test. The managers of ABC Company should

Question

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Since the analysis of the merger failed the ownership test, acquiring EFG Company may not be the best decision for ABC Company. Instead, they should seek alternative arrangements such as a strategic alliance with EFG Company, which could still provide the benefits of a merger without the ownership aspect. Maintaining a single-product strategy or outsourcing work to another company would not address the desire for growth and expansion through a potential merger, and a spot contract would not provide the long-term benefits of a strategic partnership.

ABC Company Wished to Acquire EFG CompanyABC Company Wished to Acquire