Which of the following factors influence the acquiring firm's choice between merger and an acquisition of stock?
I.Shareholders are dealt with directly to bypass target management and board of directors.
II.In a tender offer,usually some minority shareholders do not tender,stopping complete firm absorption.
III.Target management may be unfriendly and resist an offer.Resistance often increases the acquisition price.
A)I only
B)II only
C)III only
D)I,II,and III

Question

Quizplus · Accepted Answer

All three factors influence the acquiring firm's decision. Direct dealing with shareholders can bypass management resistance (I), minority shareholders not tendering can prevent full absorption (II), and resistance from target management can increase acquisition costs (III).

Which of the Following Factors Influence the Acquiring Firm's Choice