Question

Which of the following factors favors a tender offer over merger or consolidation?

	A) Shareholders are dealt with directly to bypass target firm’s management and board of directors.
	B) Some minority shareholders do not tender, stopping complete firm absorption.
	C) Share price may have to be raised to buy sufficient number of voting shares to gain control.
	D) All of the above.
	E) None of the above

Answer 1

A) Shareholders are dealt with directly to bypass target firm's management and board of directors.

Explanation: The most important advantage of tender offer is that the buyers can directly approach the shareholders.