Change Forces
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1) Name three of the ten Change Forces.
2) The greatest change force is technological changes - True or False?
3) What is the difference between Merger and Tender Offer?
4) What are the eight Federal Securities Laws?
5) M&A activities include:
A) Joint Ventures
B) Divestitures
C) Carve-outs
D) Spin-offs
E) All of the above
6) Define: Horizontal Merger
7) Define: Vertical Merger
8) Define: Conglomerate Merger
9) Define: Hostile Takeovers
10) Name two characteristics that a firm may possess that make it vulnerable to a takeover
11) The study of valuation is important for M&A because a major cause of acquisition failures is that the bidder pays too much. True or False
12) The leading methods used in the valuation include:
A) comparable companies or comparable transactions approach
B) spreadsheet approach
C) formula approach
D) All of the above
13) Valuation is central to the merger process? True of False
14) Firms should merge only if the value to shareholders will be
enhanced. True or False
15) Internal control mechanisms for effective corporate governance include the board of directors, ownership concentration, and executive compensation. True or False
16) Outside control mechanisms for effective corporate governance include stock price performance, institutional investors, proxy contests, and takeovers. True or False
17) List three reasons why mergers fail.
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Solution Summary
1) Name three of the ten Change Forces.
2) The greatest change force is technological changes - True or False?
3) What is the difference between Merger and Tender Offer?
4) What are the eight Federal Securities Laws?
5) M&A activities include:
A) Joint Ventures
B) Divestitures
C) Carve-outs
D) Spin-offs
E) All of the above
6) Define: Horizontal Merger
7) Define: Vertical Merger
8) Define: Conglomerate Merger
9) Define: Hostile Takeovers
10) Name two characteristics that a firm may possess that make it vulnerable to a takeover
11) The study of valuation is important for M&A because a major cause of acquisition failures is that the bidder pays too much. True or False
12) The leading methods used in the valuation include:
A) comparable companies or comparable transactions approach
B) spreadsheet approach
C) formula approach
D) All of the above
13) Valuation is central to the merger process? True of False
14) Firms should merge only if the value to shareholders will be
enhanced. True or False
15) Internal control mechanisms for effective corporate governance include the board of directors, ownership concentration, and executive compensation. True or False
16) Outside control mechanisms for effective corporate governance include stock price performance, institutional investors, proxy contests, and takeovers. True or False
17) List three reasons why mergers fail.
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1) Name three of the ten Change Forces.
Convenience
Choice
Other change forces are: Lifestyle, Discounting, Value-ad, customer service, technology
2) The greatest change force is technological changes - True or False? True
3) What is the difference between Merger and Tender Offer?
Merger - It is the the combination of two companies, via traditional legal services. The shareholders have to vote on the Merger (joining of two companies). Mergers require time and planning. Documents need to be drawn up, meetings of shareholders held, and the logistics of bringing the two companies together.
Tender Offer - This is the act/offer to purchase share in a corporation. The offer could be for all, some, or a majority of the company shares. Tender Offer is more like an open bid for a takeover.
4) What are the eight ...
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