The term synergy merger.

Question

Want to see more full solutions like this?

Answer 1

Question

Chapter 26, Problem 1Q

a)

Summary Introduction

To define: The term synergy merger.

a)

Expert Solution

Explanation of Solution

Synergy is the motivation to merger. It means that after merger corporations are able to reduce cost and gain from merger. It results in economies of scale in management, marketing and production and increases efficiency. Merger is brings business of two firms under one business and increasing the value of shares.

b)

Summary Introduction

To discuss: The definition of vertical merger, horizontal merger, congeneric merger and conglomerate merger.

b)

Expert Solution

Explanation of Solution

Horizontal merger means joining business of having same line of business. Vertical merger means joining business with its supplier or customer. Congeneric merger happens between related industries. Conglomerate merger happens when one business decides to enter into another industry and join with company in another industry.

c)

Summary Introduction

To discuss: The definition of friendly merger, hostile merger, defensive merger, tender offer, target Company, breakup value, and acquiring company.

c)

Expert Solution

Explanation of Solution

A merger in which merger is approved by both the companies is called friendly merger. A situation where merger offer is resisted by the target company, it is called hostile merger. When one company is acquired by another company but target company tries to avoid acquisition by initial acquisition company is defensive merger.

A tender offer is a friendly merger where merger takes place with the approval of management of both companies and shareholders tender the shares. Target Company is the firm which is acquired by another company under merger. Breakup value is the value of company which is acquired by another company. Acquiring company is the company which purchase the another company under merger.

d)

Summary Introduction

To discuss: The definition of operating merger, financial merger.

d)

Expert Solution

Explanation of Solution

An operating merger is merger in which operations in the firm involved are integrated and generate operating synergy. Financial merger is where operations of two companies are not integrated and does not generate operating synergy.

e)

Summary Introduction

To discuss: The definition of purchase accounting.

e)

Expert Solution

Explanation of Solution

Purchase accounting is a method of accounting in which assets and liabilities of the firm are valued at fair price when merger is taking place to record in the books of acquiring company.

f)

Summary Introduction

To discuss: The definition of white knight, proxy fight.

f)

Expert Solution

Explanation of Solution

White knight is the situation under merger where friendly investor invests in the company and acquires it with the support of management. The merger takes place at the fair value or fair consideration of assets and liabilities. Proxy fight is situation that arises when shareholders send their representatives as proxy and they form a group and try to win corporate vote.

g)

Summary Introduction

To discuss: The definition of joint venture, corporate alliance.

g)

Expert Solution

Explanation of Solution

Joint venture is a creation of new entity by two or more parties to acquire new market, to gain from enhanced operations by acquiring skills and capabilities and sharing the risk of investment. Corporate alliance is a relationship build with the motive to reduce cost and improve efficiency.

h)

Summary Introduction

To discuss: The definition of divestiture, spin-off

h)

Expert Solution

Explanation of Solution

Divestiture means divestment. It means withdrawing or cutting-off the investments done by company into another company. Spin-off of corporate means that company splits its one part business as a separate business.

i)

Summary Introduction

To discuss: The definition of holding company, operating company, parent company

i)

Expert Solution

Explanation of Solution

Holding company is the company which has ownership interest in another company and runs the business of these companies. An operating company is the company which runs operations and provides with goods and services to customers. Parent company is the company which holds sufficient power in another company to influence the operations of the company. Sometimes holding company is also known as parent company.

j)

Summary Introduction

To discuss: The definition of arbitrage, risk arbitrage

j)

Expert Solution

Explanation of Solution

Arbitrage is the advantage of difference in price in the two or more different markets and has no negative cash-flows as commodities are simultaneously bought and sold in two different markets at different prices striking the imbalance. Risk arbitrage means that stocks are purchased of the companies which may become takeover targets in some near future.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Students have asked these similar questions

Use the binomial method to determine the value of an American Put option at time t = 0. The option expires at time t = T = 1/2 and has exercise price E = 55. The current value of the underlying is S(0) = 50 with the underlying paying continuous dividends at the rate D = 0.05. The interest rate is r = 0.3. Use a time step of St = 1/6. Consider the case of p = 1/2 and suppose the volatility is σ = 0.3. Perform all calculations using a minimum of 4 decimal places of accuracy. =

Consider a European chooser option with exercise price E₁ and expiry date T₁ where the relevant put and call options, which depend on the value of the same underlying asset S, have the same exercise price E2 and expiry date T₂. Determine, in terms of other elementary options, the value of the chooser option for the special case when T₁ = T2. Clearly define all notation that you use.

The continuous conditional probability density function pc(S, t; S', t') for a risk neutral lognormal random walk is given by Pc(S, t; S', t') = 1 σS'√2π(t' - t) - (log(S/S) (ro²)(t − t)] exp 202 (t't) In the binomial method, the value of the underlying is Sm at time step môt and the value of the underlying at time step (m + 1)St is Sm+1. For this case evaluate Ec[(Sm+1)k|Sm] = [°° (S')*pc(S™, mdt; S', (m + 1)8t)dS' showing all steps, where k is a positive integer with k ≥ 1. You may assume that 1 e (x-n)2 2s2dx = 1 for all real numbers n and s with s > 0.

Answer 2

Question

Chapter 26, Problem 1Q

a)

Summary Introduction

To define: The term synergy merger.

a)

Expert Solution

Explanation of Solution

Synergy is the motivation to merger. It means that after merger corporations are able to reduce cost and gain from merger. It results in economies of scale in management, marketing and production and increases efficiency. Merger is brings business of two firms under one business and increasing the value of shares.

b)

Summary Introduction

To discuss: The definition of vertical merger, horizontal merger, congeneric merger and conglomerate merger.

b)

Expert Solution

Explanation of Solution

Horizontal merger means joining business of having same line of business. Vertical merger means joining business with its supplier or customer. Congeneric merger happens between related industries. Conglomerate merger happens when one business decides to enter into another industry and join with company in another industry.

c)

Summary Introduction

To discuss: The definition of friendly merger, hostile merger, defensive merger, tender offer, target Company, breakup value, and acquiring company.

c)

Expert Solution

Explanation of Solution

A merger in which merger is approved by both the companies is called friendly merger. A situation where merger offer is resisted by the target company, it is called hostile merger. When one company is acquired by another company but target company tries to avoid acquisition by initial acquisition company is defensive merger.

A tender offer is a friendly merger where merger takes place with the approval of management of both companies and shareholders tender the shares. Target Company is the firm which is acquired by another company under merger. Breakup value is the value of company which is acquired by another company. Acquiring company is the company which purchase the another company under merger.

d)

Summary Introduction

To discuss: The definition of operating merger, financial merger.

d)

Expert Solution

Explanation of Solution

An operating merger is merger in which operations in the firm involved are integrated and generate operating synergy. Financial merger is where operations of two companies are not integrated and does not generate operating synergy.

e)

Summary Introduction

To discuss: The definition of purchase accounting.

e)

Expert Solution

Explanation of Solution

Purchase accounting is a method of accounting in which assets and liabilities of the firm are valued at fair price when merger is taking place to record in the books of acquiring company.

f)

Summary Introduction

To discuss: The definition of white knight, proxy fight.

f)

Expert Solution

Explanation of Solution

White knight is the situation under merger where friendly investor invests in the company and acquires it with the support of management. The merger takes place at the fair value or fair consideration of assets and liabilities. Proxy fight is situation that arises when shareholders send their representatives as proxy and they form a group and try to win corporate vote.

g)

Summary Introduction

To discuss: The definition of joint venture, corporate alliance.

g)

Expert Solution

Explanation of Solution

Joint venture is a creation of new entity by two or more parties to acquire new market, to gain from enhanced operations by acquiring skills and capabilities and sharing the risk of investment. Corporate alliance is a relationship build with the motive to reduce cost and improve efficiency.

h)

Summary Introduction

To discuss: The definition of divestiture, spin-off

h)

Expert Solution

Explanation of Solution

Divestiture means divestment. It means withdrawing or cutting-off the investments done by company into another company. Spin-off of corporate means that company splits its one part business as a separate business.

i)

Summary Introduction

To discuss: The definition of holding company, operating company, parent company

i)

Expert Solution

Explanation of Solution

Holding company is the company which has ownership interest in another company and runs the business of these companies. An operating company is the company which runs operations and provides with goods and services to customers. Parent company is the company which holds sufficient power in another company to influence the operations of the company. Sometimes holding company is also known as parent company.

j)

Summary Introduction

To discuss: The definition of arbitrage, risk arbitrage

j)

Expert Solution

Explanation of Solution

Arbitrage is the advantage of difference in price in the two or more different markets and has no negative cash-flows as commodities are simultaneously bought and sold in two different markets at different prices striking the imbalance. Risk arbitrage means that stocks are purchased of the companies which may become takeover targets in some near future.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 3

Question

Chapter 26, Problem 1Q

a)

Summary Introduction

To define: The term synergy merger.

a)

Expert Solution

Explanation of Solution

Synergy is the motivation to merger. It means that after merger corporations are able to reduce cost and gain from merger. It results in economies of scale in management, marketing and production and increases efficiency. Merger is brings business of two firms under one business and increasing the value of shares.

b)

Summary Introduction

To discuss: The definition of vertical merger, horizontal merger, congeneric merger and conglomerate merger.

b)

Expert Solution

Explanation of Solution

Horizontal merger means joining business of having same line of business. Vertical merger means joining business with its supplier or customer. Congeneric merger happens between related industries. Conglomerate merger happens when one business decides to enter into another industry and join with company in another industry.

c)

Summary Introduction

To discuss: The definition of friendly merger, hostile merger, defensive merger, tender offer, target Company, breakup value, and acquiring company.

c)

Expert Solution

Explanation of Solution

A merger in which merger is approved by both the companies is called friendly merger. A situation where merger offer is resisted by the target company, it is called hostile merger. When one company is acquired by another company but target company tries to avoid acquisition by initial acquisition company is defensive merger.

A tender offer is a friendly merger where merger takes place with the approval of management of both companies and shareholders tender the shares. Target Company is the firm which is acquired by another company under merger. Breakup value is the value of company which is acquired by another company. Acquiring company is the company which purchase the another company under merger.

d)

Summary Introduction

To discuss: The definition of operating merger, financial merger.

d)

Expert Solution

Explanation of Solution

An operating merger is merger in which operations in the firm involved are integrated and generate operating synergy. Financial merger is where operations of two companies are not integrated and does not generate operating synergy.

e)

Summary Introduction

To discuss: The definition of purchase accounting.

e)

Expert Solution

Explanation of Solution

Purchase accounting is a method of accounting in which assets and liabilities of the firm are valued at fair price when merger is taking place to record in the books of acquiring company.

f)

Summary Introduction

To discuss: The definition of white knight, proxy fight.

f)

Expert Solution

Explanation of Solution

White knight is the situation under merger where friendly investor invests in the company and acquires it with the support of management. The merger takes place at the fair value or fair consideration of assets and liabilities. Proxy fight is situation that arises when shareholders send their representatives as proxy and they form a group and try to win corporate vote.

g)

Summary Introduction

To discuss: The definition of joint venture, corporate alliance.

g)

Expert Solution

Explanation of Solution

Joint venture is a creation of new entity by two or more parties to acquire new market, to gain from enhanced operations by acquiring skills and capabilities and sharing the risk of investment. Corporate alliance is a relationship build with the motive to reduce cost and improve efficiency.

h)

Summary Introduction

To discuss: The definition of divestiture, spin-off

h)

Expert Solution

Explanation of Solution

Divestiture means divestment. It means withdrawing or cutting-off the investments done by company into another company. Spin-off of corporate means that company splits its one part business as a separate business.

i)

Summary Introduction

To discuss: The definition of holding company, operating company, parent company

i)

Expert Solution

Explanation of Solution

Holding company is the company which has ownership interest in another company and runs the business of these companies. An operating company is the company which runs operations and provides with goods and services to customers. Parent company is the company which holds sufficient power in another company to influence the operations of the company. Sometimes holding company is also known as parent company.

j)

Summary Introduction

To discuss: The definition of arbitrage, risk arbitrage

j)

Expert Solution

Explanation of Solution

Arbitrage is the advantage of difference in price in the two or more different markets and has no negative cash-flows as commodities are simultaneously bought and sold in two different markets at different prices striking the imbalance. Risk arbitrage means that stocks are purchased of the companies which may become takeover targets in some near future.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 4

Question

Chapter 26, Problem 1Q

a)

Summary Introduction

To define: The term synergy merger.

a)

Expert Solution

Explanation of Solution

Synergy is the motivation to merger. It means that after merger corporations are able to reduce cost and gain from merger. It results in economies of scale in management, marketing and production and increases efficiency. Merger is brings business of two firms under one business and increasing the value of shares.

b)

Summary Introduction

To discuss: The definition of vertical merger, horizontal merger, congeneric merger and conglomerate merger.

b)

Expert Solution

Explanation of Solution

Horizontal merger means joining business of having same line of business. Vertical merger means joining business with its supplier or customer. Congeneric merger happens between related industries. Conglomerate merger happens when one business decides to enter into another industry and join with company in another industry.

c)

Summary Introduction

To discuss: The definition of friendly merger, hostile merger, defensive merger, tender offer, target Company, breakup value, and acquiring company.

c)

Expert Solution

Explanation of Solution

A merger in which merger is approved by both the companies is called friendly merger. A situation where merger offer is resisted by the target company, it is called hostile merger. When one company is acquired by another company but target company tries to avoid acquisition by initial acquisition company is defensive merger.

A tender offer is a friendly merger where merger takes place with the approval of management of both companies and shareholders tender the shares. Target Company is the firm which is acquired by another company under merger. Breakup value is the value of company which is acquired by another company. Acquiring company is the company which purchase the another company under merger.

d)

Summary Introduction

To discuss: The definition of operating merger, financial merger.

d)

Expert Solution

Explanation of Solution

An operating merger is merger in which operations in the firm involved are integrated and generate operating synergy. Financial merger is where operations of two companies are not integrated and does not generate operating synergy.

e)

Summary Introduction

To discuss: The definition of purchase accounting.

e)

Expert Solution

Explanation of Solution

Purchase accounting is a method of accounting in which assets and liabilities of the firm are valued at fair price when merger is taking place to record in the books of acquiring company.

f)

Summary Introduction

To discuss: The definition of white knight, proxy fight.

f)

Expert Solution

Explanation of Solution

White knight is the situation under merger where friendly investor invests in the company and acquires it with the support of management. The merger takes place at the fair value or fair consideration of assets and liabilities. Proxy fight is situation that arises when shareholders send their representatives as proxy and they form a group and try to win corporate vote.

g)

Summary Introduction

To discuss: The definition of joint venture, corporate alliance.

g)

Expert Solution

Explanation of Solution

Joint venture is a creation of new entity by two or more parties to acquire new market, to gain from enhanced operations by acquiring skills and capabilities and sharing the risk of investment. Corporate alliance is a relationship build with the motive to reduce cost and improve efficiency.

h)

Summary Introduction

To discuss: The definition of divestiture, spin-off

h)

Expert Solution

Explanation of Solution

Divestiture means divestment. It means withdrawing or cutting-off the investments done by company into another company. Spin-off of corporate means that company splits its one part business as a separate business.

i)

Summary Introduction

To discuss: The definition of holding company, operating company, parent company

i)

Expert Solution

Explanation of Solution

Holding company is the company which has ownership interest in another company and runs the business of these companies. An operating company is the company which runs operations and provides with goods and services to customers. Parent company is the company which holds sufficient power in another company to influence the operations of the company. Sometimes holding company is also known as parent company.

j)

Summary Introduction

To discuss: The definition of arbitrage, risk arbitrage

j)

Expert Solution

Explanation of Solution

Arbitrage is the advantage of difference in price in the two or more different markets and has no negative cash-flows as commodities are simultaneously bought and sold in two different markets at different prices striking the imbalance. Risk arbitrage means that stocks are purchased of the companies which may become takeover targets in some near future.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 5

Chapter 26, Problem 1Q

a)

Summary Introduction

To define: The term synergy merger.

a)

Expert Solution

Explanation of Solution

Synergy is the motivation to merger. It means that after merger corporations are able to reduce cost and gain from merger. It results in economies of scale in management, marketing and production and increases efficiency. Merger is brings business of two firms under one business and increasing the value of shares.

b)

Summary Introduction

To discuss: The definition of vertical merger, horizontal merger, congeneric merger and conglomerate merger.

b)

Expert Solution

Explanation of Solution

Horizontal merger means joining business of having same line of business. Vertical merger means joining business with its supplier or customer. Congeneric merger happens between related industries. Conglomerate merger happens when one business decides to enter into another industry and join with company in another industry.

c)

Summary Introduction

To discuss: The definition of friendly merger, hostile merger, defensive merger, tender offer, target Company, breakup value, and acquiring company.

c)

Expert Solution

Explanation of Solution

A merger in which merger is approved by both the companies is called friendly merger. A situation where merger offer is resisted by the target company, it is called hostile merger. When one company is acquired by another company but target company tries to avoid acquisition by initial acquisition company is defensive merger.

A tender offer is a friendly merger where merger takes place with the approval of management of both companies and shareholders tender the shares. Target Company is the firm which is acquired by another company under merger. Breakup value is the value of company which is acquired by another company. Acquiring company is the company which purchase the another company under merger.

d)

Summary Introduction

To discuss: The definition of operating merger, financial merger.

d)

Expert Solution

Explanation of Solution

An operating merger is merger in which operations in the firm involved are integrated and generate operating synergy. Financial merger is where operations of two companies are not integrated and does not generate operating synergy.

e)

Summary Introduction

To discuss: The definition of purchase accounting.

e)

Expert Solution

Explanation of Solution

Purchase accounting is a method of accounting in which assets and liabilities of the firm are valued at fair price when merger is taking place to record in the books of acquiring company.

f)

Summary Introduction

To discuss: The definition of white knight, proxy fight.

f)

Expert Solution

Explanation of Solution

White knight is the situation under merger where friendly investor invests in the company and acquires it with the support of management. The merger takes place at the fair value or fair consideration of assets and liabilities. Proxy fight is situation that arises when shareholders send their representatives as proxy and they form a group and try to win corporate vote.

g)

Summary Introduction

To discuss: The definition of joint venture, corporate alliance.

g)

Expert Solution

Explanation of Solution

Joint venture is a creation of new entity by two or more parties to acquire new market, to gain from enhanced operations by acquiring skills and capabilities and sharing the risk of investment. Corporate alliance is a relationship build with the motive to reduce cost and improve efficiency.

h)

Summary Introduction

To discuss: The definition of divestiture, spin-off

h)

Expert Solution

Explanation of Solution

Divestiture means divestment. It means withdrawing or cutting-off the investments done by company into another company. Spin-off of corporate means that company splits its one part business as a separate business.

i)

Summary Introduction

To discuss: The definition of holding company, operating company, parent company

i)

Expert Solution

Explanation of Solution

Holding company is the company which has ownership interest in another company and runs the business of these companies. An operating company is the company which runs operations and provides with goods and services to customers. Parent company is the company which holds sufficient power in another company to influence the operations of the company. Sometimes holding company is also known as parent company.

j)

Summary Introduction

To discuss: The definition of arbitrage, risk arbitrage

j)

Expert Solution

Explanation of Solution

Arbitrage is the advantage of difference in price in the two or more different markets and has no negative cash-flows as commodities are simultaneously bought and sold in two different markets at different prices striking the imbalance. Risk arbitrage means that stocks are purchased of the companies which may become takeover targets in some near future.

Answer 6

Chapter 26, Problem 1Q

a)

Summary Introduction

To define: The term synergy merger.

a)

Expert Solution

Explanation of Solution

Synergy is the motivation to merger. It means that after merger corporations are able to reduce cost and gain from merger. It results in economies of scale in management, marketing and production and increases efficiency. Merger is brings business of two firms under one business and increasing the value of shares.

Answer 7

Chapter 26, Problem 1Q

a)

Summary Introduction

To define: The term synergy merger.

Answer 8

a)

Expert Solution

Explanation of Solution

Synergy is the motivation to merger. It means that after merger corporations are able to reduce cost and gain from merger. It results in economies of scale in management, marketing and production and increases efficiency. Merger is brings business of two firms under one business and increasing the value of shares.

Answer 9

a)

Expert Solution

Answer 10

a)

Expert Solution

Answer 11

Expert Solution

Answer 12

b)

Summary Introduction

To discuss: The definition of vertical merger, horizontal merger, congeneric merger and conglomerate merger.

b)

Expert Solution

Explanation of Solution

Horizontal merger means joining business of having same line of business. Vertical merger means joining business with its supplier or customer. Congeneric merger happens between related industries. Conglomerate merger happens when one business decides to enter into another industry and join with company in another industry.

Answer 13

b)

Summary Introduction

To discuss: The definition of vertical merger, horizontal merger, congeneric merger and conglomerate merger.

Answer 14

b)

Expert Solution

Explanation of Solution

Horizontal merger means joining business of having same line of business. Vertical merger means joining business with its supplier or customer. Congeneric merger happens between related industries. Conglomerate merger happens when one business decides to enter into another industry and join with company in another industry.

Answer 15

b)

Expert Solution

Answer 16

b)

Expert Solution

Answer 17

Expert Solution

Answer 18

c)

Summary Introduction

To discuss: The definition of friendly merger, hostile merger, defensive merger, tender offer, target Company, breakup value, and acquiring company.

c)

Expert Solution

Explanation of Solution

A merger in which merger is approved by both the companies is called friendly merger. A situation where merger offer is resisted by the target company, it is called hostile merger. When one company is acquired by another company but target company tries to avoid acquisition by initial acquisition company is defensive merger.

A tender offer is a friendly merger where merger takes place with the approval of management of both companies and shareholders tender the shares. Target Company is the firm which is acquired by another company under merger. Breakup value is the value of company which is acquired by another company. Acquiring company is the company which purchase the another company under merger.

Answer 19

c)

Summary Introduction

To discuss: The definition of friendly merger, hostile merger, defensive merger, tender offer, target Company, breakup value, and acquiring company.

Answer 20

c)

Expert Solution

Explanation of Solution

A merger in which merger is approved by both the companies is called friendly merger. A situation where merger offer is resisted by the target company, it is called hostile merger. When one company is acquired by another company but target company tries to avoid acquisition by initial acquisition company is defensive merger.

A tender offer is a friendly merger where merger takes place with the approval of management of both companies and shareholders tender the shares. Target Company is the firm which is acquired by another company under merger. Breakup value is the value of company which is acquired by another company. Acquiring company is the company which purchase the another company under merger.

Answer 21

c)

Expert Solution

Answer 22

c)

Expert Solution

Answer 23

Expert Solution

Answer 24

d)

Summary Introduction

To discuss: The definition of operating merger, financial merger.

d)

Expert Solution

Explanation of Solution

An operating merger is merger in which operations in the firm involved are integrated and generate operating synergy. Financial merger is where operations of two companies are not integrated and does not generate operating synergy.

Answer 25

d)

Summary Introduction

To discuss: The definition of operating merger, financial merger.

Answer 26

d)

Expert Solution

Explanation of Solution

An operating merger is merger in which operations in the firm involved are integrated and generate operating synergy. Financial merger is where operations of two companies are not integrated and does not generate operating synergy.

Answer 27

d)

Expert Solution

Answer 28

d)

Expert Solution

Answer 29

Expert Solution

Answer 30

e)

Summary Introduction

To discuss: The definition of purchase accounting.

e)

Expert Solution

Explanation of Solution

Purchase accounting is a method of accounting in which assets and liabilities of the firm are valued at fair price when merger is taking place to record in the books of acquiring company.

Answer 31

e)

Summary Introduction

To discuss: The definition of purchase accounting.

Answer 32

e)

Expert Solution

Explanation of Solution

Purchase accounting is a method of accounting in which assets and liabilities of the firm are valued at fair price when merger is taking place to record in the books of acquiring company.

Answer 33

e)

Expert Solution

Answer 34

e)

Expert Solution

Answer 35

Expert Solution

Answer 36

f)

Summary Introduction

To discuss: The definition of white knight, proxy fight.

f)

Expert Solution

Explanation of Solution

White knight is the situation under merger where friendly investor invests in the company and acquires it with the support of management. The merger takes place at the fair value or fair consideration of assets and liabilities. Proxy fight is situation that arises when shareholders send their representatives as proxy and they form a group and try to win corporate vote.

Answer 37

f)

Summary Introduction

To discuss: The definition of white knight, proxy fight.

Answer 38

f)

Expert Solution

Explanation of Solution

White knight is the situation under merger where friendly investor invests in the company and acquires it with the support of management. The merger takes place at the fair value or fair consideration of assets and liabilities. Proxy fight is situation that arises when shareholders send their representatives as proxy and they form a group and try to win corporate vote.

Answer 39

f)

Expert Solution

Answer 40

f)

Expert Solution

Answer 41

Expert Solution

Answer 42

g)

Summary Introduction

To discuss: The definition of joint venture, corporate alliance.

g)

Expert Solution

Explanation of Solution

Joint venture is a creation of new entity by two or more parties to acquire new market, to gain from enhanced operations by acquiring skills and capabilities and sharing the risk of investment. Corporate alliance is a relationship build with the motive to reduce cost and improve efficiency.

Answer 43

g)

Summary Introduction

To discuss: The definition of joint venture, corporate alliance.

Answer 44

g)

Expert Solution

Explanation of Solution

Joint venture is a creation of new entity by two or more parties to acquire new market, to gain from enhanced operations by acquiring skills and capabilities and sharing the risk of investment. Corporate alliance is a relationship build with the motive to reduce cost and improve efficiency.

Answer 45

g)

Expert Solution

Answer 46

g)

Expert Solution

Answer 47

Expert Solution

Answer 48

h)

Summary Introduction

To discuss: The definition of divestiture, spin-off

h)

Expert Solution

Explanation of Solution

Divestiture means divestment. It means withdrawing or cutting-off the investments done by company into another company. Spin-off of corporate means that company splits its one part business as a separate business.

Answer 49

h)

Summary Introduction

To discuss: The definition of divestiture, spin-off

Answer 50

h)

Expert Solution

Explanation of Solution

Divestiture means divestment. It means withdrawing or cutting-off the investments done by company into another company. Spin-off of corporate means that company splits its one part business as a separate business.

Answer 51

h)

Expert Solution

Answer 52

h)

Expert Solution

Answer 53

Expert Solution

Answer 54

i)

Summary Introduction

To discuss: The definition of holding company, operating company, parent company

i)

Expert Solution

Explanation of Solution

Holding company is the company which has ownership interest in another company and runs the business of these companies. An operating company is the company which runs operations and provides with goods and services to customers. Parent company is the company which holds sufficient power in another company to influence the operations of the company. Sometimes holding company is also known as parent company.

Answer 55

i)

Summary Introduction

To discuss: The definition of holding company, operating company, parent company

Answer 56

i)

Expert Solution

Explanation of Solution

Holding company is the company which has ownership interest in another company and runs the business of these companies. An operating company is the company which runs operations and provides with goods and services to customers. Parent company is the company which holds sufficient power in another company to influence the operations of the company. Sometimes holding company is also known as parent company.

Answer 57

i)

Expert Solution

Answer 58

i)

Expert Solution

Answer 59

Expert Solution

Answer 60

j)

Summary Introduction

To discuss: The definition of arbitrage, risk arbitrage

j)

Expert Solution

Explanation of Solution

Arbitrage is the advantage of difference in price in the two or more different markets and has no negative cash-flows as commodities are simultaneously bought and sold in two different markets at different prices striking the imbalance. Risk arbitrage means that stocks are purchased of the companies which may become takeover targets in some near future.

Answer 61

j)

Summary Introduction

To discuss: The definition of arbitrage, risk arbitrage

Answer 62

j)

Expert Solution

Explanation of Solution

Arbitrage is the advantage of difference in price in the two or more different markets and has no negative cash-flows as commodities are simultaneously bought and sold in two different markets at different prices striking the imbalance. Risk arbitrage means that stocks are purchased of the companies which may become takeover targets in some near future.