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Subsidiary Stock - stock by another interested party would...

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Reasons for an acquiring company to pay more than the book value for subsidiary stock acquired include the fact that the land may have been undervalued; specific assets may have appreciated; there may be an existence of unrecorded goodwill; liabilities (especially long-term liabilities) may have been overvalued; fluctuations in the market, such as a large purchase of the company’s
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Unformatted text preview: stock by another interested party would increase the price of the stock and prompt the acquiring company to move in quickly and purchase the stock at a premium to prevent the other potential buyer from acquiring control first....
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