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24. The simplest way to divest an asset is: A. to spin-off B. to carve-out C.to sell it D. none of the above Type: Medium 25. Asset sales are common in: Type: Easy
Chapter 32 - Corporate Restructuring 32-23 26. A privatization is a: Type: Difficult 27. Most privatizations resemble: Type: Easy 28. The following are examples of privatization except: A. Habib Bank B.AT&T C. West Japan Railway Company D. ONGC Type: Easy 29. Privatizations transactions resemble: Type: Easy
Chapter 32 - Corporate Restructuring 32-24 30. The following are important motives for privatization except: Type: Medium 31. The following are private equity groups: Type: Easy 32. Which of the following statements is/are true of limited partnerships? A. Limited partners enjoy limited liability but do not participate in management. B. Generally limited partners put up most of the money. C. Generally limited partners are institutional investors. D.All of the above statements are true of limited partnerships. Type: Medium 33. A private-equity investment fund is organized as a: Type: Easy
Chapter 32 - Corporate Restructuring 32-25 34. The following statements are true of partnership agreements: I) The partnership agreement has a limited term, 10 years or less. II) The general partners get a management fee plus carried interest in 20% of any profits earned by the partnership. III) The limited partners get paid off first, but they get only 80% of any further returns. IV) The general partners can reinvest the limited partners' money. Type: Difficult 35. The following are advantages of private-equity partnerships: I) carried interest gives the general partners potential for high profits. II) carried interest, because it a call option, gives the general partners incentives to take risks as they are strongly motivated to earn back the limited partners' investment and deliver a profit. III) There is no separation of ownership and control and general partners can intervene in the fund's portfolio companies any time performance lags or strategy needs change. IV) There is no free cash flow problem as cash from first round must be distributed to investors. Type: Difficult