Question: A student has been presented with the following fact pattern. A Ltd and B Ltd combine by creating C Ltd which acquires all the shares

A student has been presented with the following fact pattern. A Ltd and B Ltd combine by creating C Ltd which acquires all the shares in A Ltd and B Ltd and issues its own shares in exchange. The student knows it is important to identify an acquirer in a business combination. However, they do not understand why or the consequences of wrongly applying that process. They ask you for an explanation.

Required Explain to the student why it is important and the consequences of wrongly applying the process.

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