(a) Many explanations and justifications are made by acquiring (and sometimes target) managers for a merger. Review...

Question:

(a) Many explanations and justifications are made by acquiring (and sometimes target)

managers for a merger. Review these justifications and discuss whether they are good or bad for shareholders.

(b) An argument has been made that financial mergers are bad for shareholders because bondholders benefit from the reduction in risk. However, are there situations where a financial merger can be good for shareholders?

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Corporate Finance

ISBN: 9780077173630

3rd Edition

Authors: David Hillier, Stephen A. Ross, Randolph W. Westerfield, Bradford D. Jordan, Jeffrey F. Jaffe

See More Books

Question Posted: Feb 22, 2024 03:02 AM

See More Questions

Read the case study "Southwest Airlines," found in Part 2 of your textbook. Review the "Guide to Case Analysis" found on pp. CA1 - CA11 of your textbook. (This guide follows the last case in the...
Discuss the article and answer the following questions: What are your top 3 main takeaways from this article? What are some alternatives to tying executives compensation to performance? What are...
On November 1, 2018, the following were the account balances of Mountain Equipment Repair Limited. Mountains year-end is October 31 and it records adjusting entries monthly. Enter the November 1...
Can Moore's Law continue to hold forever? That is, can technology continue to advance at its current rate indefinitely, causing the number of transistors that fit on a microchip to double every 12 to...
Van Auken Lumbers 2007 financial statements are shown below. Van Auken Lumber: Balance Sheet as of December 31, 2007 (Thousands of Dollars) Van Auken Lumber: Income Statement for December 31, 2007...
Find the solution to Stokes flow past a sphere where the far-field velocity satisfies the elongational flow defined as $v_{x}=\dot{\gamma} x, v_{y}=$ $\dot{\gamma} y$, and \(v_{z}=-2 \dot{\gamma}...
Allowance Method of Accounting for Bad DebtsComparison of the Two Approaches Kandel Company had the following data available for 2010 (before making any adjustments): Accounts receivable, 12/31/10...
How can one efficaciously strategize temporal allocation amidst the multifaceted demands of modern life ? Explain
Outline the two broad methods of payment in M&A transactions. What might determine the method of payment, and what impact does this have on both the acquiring and the target firm?
Why do you think that M&A activity often clusters in time, causing M&A waves? What M&A waves can you identify from history? Are there any factors which you think are uniquely favourable to M&A...
Bryn, age 35, has a traditional IRA with a fair market value of $$680,000$ and a basis of $$140,000.$ She has decided to convert her traditional IRA to a Roth IRA. What are the tax consequences?...
National Wheelchair basketball association are condemning a match? Do they have partnerships with other organization? If so, what are they? Can you think of partnerships that would be beneficial for...
What component in app inventor provides two functions : storevalue and getvalue ? Explain also discuss what is the function of storevalue and getvalue?
Florida approved a legislation mandating random drug testing and biannual testing of all workers due to concerns about the effects of illicit substances on the job. Is there anything in the law that...
Should the government itself become an insurer of last resort, or would betterregulation of the private insurance industry ensure better results?
How should a healthcare worker respond if someone inquires about a patients medical records that is not authorized to receive this information?
Write the letter of the method that is most applicable to each statement. a. Specific identification b. Average cost c. First-in, first-out (FIFO) d. Last-in, first-out (LIFO) ____________ 1. Is the...
The activities listed in lines 2125 serve primarily as examples of A) Underappreciated dangers B) Intolerable risks C) Medical priorities D) Policy failures
Look back at the Pfizer example in Section 18.1. Suppose that Pfizer moves to a 40 percent book debt ratio by issuing debt and using the proceeds to repurchase shares. Consider only corporate taxes....
Tables 18.3(a) and 18.3(b), although pertaining to a real company, are really just a simplified numerical example. What factors would you expect to determine the value of interest tax shields in...
The right of shareholders to default is a valuable privilege. Explain.
A couple is sitting in the middle of an auditorium before the play starts. Even though everyone in the auditorium is talking, they can only hear each other's conversation. What is this an example of?
If assets are $100,000 and liabilities are $40,000 how much is stockholders equity?
How do corporations make financial disclosures about the corporation at the end of the financial year? Who benefits from this disclosure? At the end of the financial year, a corporation has to make a...

(a) Many explanations and justifications are made by acquiring (and sometimes target) managers for a merger. Review...

Question:

Step by Step Answer:

Mergers and Justifications Impact on Shareholders a Justifications for Mergers Managers often present various justifications for mergersbut their vali...View the full answer

Corporate Finance

Students also viewed these Business questions