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The most prominent mode of transferring control of corporate assets is merger. Recall that a merger is a transaction in which one corporation (the acquired) secures title to the stock or assets of another (the acquired).
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INTRODUCTION The most prominent mode of transferring control of corporate assets is merger. Recall that a merger is a transaction in which one corporation (the acquired) secures title to the stock or assets of another (the acquired). Consummation of a merger requires the approves the transaction, it puts the merger proposal to a stockholder vote. Depending on the percentage of favourable votes required by the state corporate code, the merger is approved or rejected. In effect, though, management has a veto power over all merger proposals and can refuse to put any proposal to a stockholder vote. Tender offers, by contract, do not require the explicit approval of the incumbent management. A tender offer is a public offer made by the management of one firm (the bidder) to purchase a block of another (the target) firm's outstanding common stock. Tender offers are made directly to the target's stockholders. If enough...
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