Paymeny-in-kind preferred stock
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Paymeny-in-kind preferred stock has been primarily used to finance _______
a) new high-risk ventures,
b) expansion in foreign manufacturing,
c) takeovers,
d) privatization of corporations
please advise answer & why!
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SOLUTION This solution is FREE courtesy of BrainMass!
1. c) Takeover. When companies go for leveraged buyouts, they are out of cash and they would like to issue payment in kind preferred stock. That means when the company does not have enough cash to pay for the preferred dividend it will issue further preferred stock for that value.
© BrainMass Inc. brainmass.com December 24, 2021, 5:12 pm ad1c9bdddf>https://brainmass.com/business/finance/payment-kind-preferred-stock-34767