Question: Nepean Corp and Warren Inc own 80 and 20 respectively

Nepean Corp. and Warren Inc. own 80% and 20%, respectively, of the common shares that carry voting rights at a general meeting of shareholders of Osaka Enterprises. Nepean sells half of its interest to Warren and buys call options from Warren that are exercisable at any time at a premium to the market price when issued, and if exercised would give Nepean its original 80% ownership interest and voting rights. At December 31, 2013, the options are out of the money.
Discuss whether Nepean is the parent of Osaka.

View Solution:

Sale on SolutionInn
  • CreatedJune 09, 2015
  • Files Included
Post your question