A(n)________ may occur if a major shareholder desires to sell a large number of shares but the market for the shares is not sufficiently liquid to sustain such a large sale without severely affecting the price.
A)open market share repurchases
B)Dutch auction share repurchase
C)tender offer
D)targeted repurchase

Question

Quizplus · Accepted Answer

A targeted repurchase occurs when a company buys back shares directly from a specific shareholder, often to fend off a hostile takeover or when a major shareholder wants to sell a large block of shares. This method can prevent the market price from being adversely affected by the large sale, which might not be possible in an illiquid market.

A(n)________ May Occur If a Major Shareholder Desires to Sell