BM Chapter 28 - Berk de Marzo Chapter 28 M&As Takeover...

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Takeover defenses - Proxy fight: The acquirer attempts to convince target shareholders to unseat the target board by using their proxy votes to support the acquirers’ candidates for election to the target board Defensive Strategies Poison Pills - Is a rights offering that gives existing target shareholders the right to buy shares in either the target or the acquirer at a deeply discounted price once certain conditions are met - Because target shareholders can purchase shares at less than the market price, existing shareholders of the acquirer effectively subsidize their purchases - This subsidization makes the takeover so expensive for the acquiring shareholders that they pass the deal - Corporate lawyers have perfected the poison pill: Instead of giving existing shareholders the right to acquire shares in an acquiring firm, most poison oils now specify that if a raider acquires more than a trigger amount of the target shares existing shareholders (except for the acquirer) have the right to buy shares in the target at a discounted price
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BM Chapter 28 - Berk de Marzo Chapter 28 M&As Takeover...

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