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4. A business deal in which all publicly owned stock in a firm is replaced with

ID: 1148903 • Letter: 4

Question

4. A business deal in which all publicly owned stock in a firm is replaced with complete equity ownership by a private group is called a a. tender offer b. proxy contest. c. going-private transaction d. leveraged buyout. e. consolidation 5. T he payments made by a firm to repurchase shares of its outstanding stock from an individual investor in an attempt to eliminate a potential unfriendly takeover attempt are referred to as a. a golden parachute b. standstill payments. c. greenmail d. a poison pill e. a white knight. 6. A financial device designed to make unfriendly takeover attempts unappealing, if not impossible, is called a. a golden parachute b. a standstill agreement c. greenmail poison white knight.

Explanation / Answer

Answer for 4

This is called as Going Private Transactios as per new GAAP standards.

Hence option C is correct answer.

Answer for 5

This was very straightforward and known as Greenmail

Hence option C is correct answer

Answer for 6

A Poison Pills hence option d is correct answer

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