Mergers and Acquisitions

UNIT: MERGERS AND ACQUISITIONS
NAME: OSCAR K K

QUESTIONS
1. Describe slightly of the measures used by companies to discourage unfriendly take-over attempts
* Supermajority voting rules .In this method, a clause is inserted in the corporate charter stipulating voting rules that a supermajority of shares, e.g. 90%, is required to approve any takeover proposals.
* poison Puts. Here, securities are issued that become valuable when an unfriendly bidder obtains control of a certain percentage of a companys shares. A good example would be a bond that contains a put option, such that if the bondholders cashing in on a specify of the companys debt will make the offer unattractive.
* well-off parachute contracts .Here, the key executives are given employment contracts infra which they receive very large benefits/send-off packages should they be all over without sufficient cause after the finalization of a merger.
* Staggered Board. The hurt of the board of directors are staggered over several years so singler of having the entire board come up for re-election at one time. The acquiring firm will face difficulty electing its give board of directors that would further its efforts to gain total control of the post firm.




If the merger process has already been initiated, alternative measures include;
* duster night. This is where the stigma companys management try to descry a more friendly acquiring company that is volition to enter into a bidding war with the first bidder
* point of view offer. Here the management of the target company attempt to talk over an agreement with the first bidder to limit its interests/ holdings in the target company
* Pacman Defense. The target company makes a takeover bid for the stock of the bidder.
* intelligent action. Here litigation, involving suits and appeals, is used just to delay delay a takeover attempt hoping that the bidding company gets frustrated halfway and quits its endeavours in protest.
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