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7 Cards in this Set
- Front
- Back
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Types of Aquisitions
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1. Asset Purchase
2. Stock Purchse |
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Asset Purchase
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Acquirer purchses all or almost all or some of the selling company;s assets; cherry pick what you want; aquirer pays for what he/she wants and target company pays off existing liabilites not taken by aquirer; RESULTS in contract issues (warranties)
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Stock Purchase
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purchase all of the stock of the target company directly from target company shareholders; RESULTS in NO contract issues; Becomes a SUBSIDIARY of company
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Merger (A + B = A)
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Acquirer survives; acquirer buys all stock of target and then disolves target (bought out); RESULT contract issues with B company = they are voided
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Merger (A + B = C)
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Consolidation; both companies merge and create a new company; RESULTS all contracts voided
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Poison Pill
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flood the market with shares so company trying to buy you out has a difficult time gathering all the shares; can result in a duty of loyalty issue
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Sarbanes Oxley Provisions
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1. Personally certify the accuracy (making officers personally liable)
2. Auditors can not be consultants for company (at same time) 3. Create an Auditing Committee = board of directos whom are not part of the corp. outside of advisors; hold little to no stock in company |
