corproate restructuring Assignment 1.docx - 1 MGT 4066...

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1 MGT 4066: Corporate Restructuring, Assignment 1 Name: Claire Hillis GT Account:chillis3 Total Points: 60 Answer true or false to the following questions (Total 15 points, each question 1 point) 1. A proxy contest is one in which a group of dissident shareholders attempts to obtain representation on a firm’s board by soliciting other shareholders for the right to vote their shares. True or False
2. A hostile tender offer is a takeover tactic in which the acquirer bypasses the target’s board and management and goes directly to the target’s shareholders with an offer to purchase their shares.
3. According to the management entrenchment hypothesis, takeover defenses are designed to
4. The shareholder interests theory suggests that shareholders gain when management resists
5. Proxy contests and tender offers are often viewed by acquirers as inexpensive ways to takeover another firm. True or False
6. All materials in a proxy contest must be filed with the SEC before they are sent to shareholders.
7. Federal and state laws make it extremely difficult for a bidder to acquire a controlling interest in
8. Tender offers always consist of an offer to exchange acquirer shares for shares in the target firm.
9. The size of the target firm is the best predictor of the likelihood of being taken over by another firm. True or False
10.
11. The threat of hostile takeovers is a factor in encouraging a firm to implement good governance
12. Operating synergy consists of economies of scale and scope. Economies of scale refer to the spreading of variable costs over increasing production levels, while economies of scope refer to
13. Deregulated industries often experience an upsurge in M&A activity shortly after regulations are removed. True or False
MGT 4066 Assignment 1
2 14. Because of hubris, managers of acquiring firms sometimes believe their valuation of a target firm is superior to the market’s valuation. Under these circumstances, they often end up overpaying

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