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3. Defending against mergers unfriersetion or event hortille in nature. 4tratevies arre called This type of financial secarity will hwo value only if an unfriendly

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3. Defending against mergers unfriersetion or event hortille in nature. 4tratevies arre called This type of financial secarity will hwo value only if an unfriendly takeover occus, It give the fina's bondholfers the riplt to relom their bonds at their par vasue prier to matunity if a Gufriendly Bidder obtains control of a specifiad percentage of the target firmit? common shares. This techrique, which is called. , is desiloned tar. Make it sioniRcantly. Make the takeovidr t candidate br restracturing tw debt and reducing trs avallatile tash balances Make it cifficult for a arectors to the beard This technique, which is called a poison pust option , is designed to: Make it significantly more difficult for the takeover vote by the firm's shareholders to be successful Make the takeover target a less attractive takeover candidate by restructuting its debt and reduding its available cash balances Make it difficult for an acquiring firm to elect its own directors to the board other strategies dice an undesired takeover bid has started. A desolotion of one of these strategles follows. Adentry the antitaknore definue. maney or repurcharling coenrmoin whanes. This stratege is fescr deciolerd of the: Thandsti- acrentert fefense Awat, ce iatilify restrutturing defenie cietermala seferiet ithation iterersed 3. Defending against mergers Many mergers are the result of a friendly and coliaborative agreement between the participating companies. Some combinations, however, are unfriendly or even hostile in nature. Firms facing unwanted and hostile takeovers will often take actions to forestall the acquisition. In general, the broad category of antitakeover strategies are called Consider the followit This type of financial security will have value only if an unfriendly takeover occurs. It gives the firm's bondholders the right to redeem their bonds at their par value prior to maturity if a unfriendly bidder obtains control of a specified percentage of the target firm's common shares. This technique, which is called , Is designed to: This technique, which is called , is designed to: Make it significantly more difficult for the takeover vote by the firm's shareholders to be successful Make the takeover target a less attractive takeover candidate by restructuring its debt and reducing its available cash balances Make it difficult for an acquiring firm to elect its own directors to the board Many of these shark repellent defensive strategies must be put into place prior to the initiation of a possible takeover Howerver, a tarpet firm may use other strategies once an undesired takeover bid has started. A description of one of these strategies follows. Identily the antitakeover defense: This strategy involves making the target firm fess attractive by either selling desirable assets or divisions, berrowing large suras of money, or repurchasing common shares. This strategy is best described as the: Standstill agreement defertse Asset or liablily restructuring defense Greesmali defense Ligigation defense

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