Consider a tender offer for a target firm in which the bidder makes a partial offer for 60% of the target's equity at a price of $28 per share. The offer is conditional on gaining control (at least 50% ownership). If the bidder gains control of the target, they will implement a new operating strategy that is expected to increase the value of the target's equity to $29 per share. The target's current stock price is $22 per share, which correctly reflects its standalone value. Assume that if the offer fails, there will be no additional offers, and the firm will remain independent indefinitely.

 a. How do you expect the target shareholders to respond to this tender offer? Why? 

b. If the offer were instead an "any-and-all" offer at the same price per share (also conditional on gaining control), would you expect a different response from target shareholders? Why or why not?

 c. Give an example of a two-tier offer with a blended price below $29 per share that could lead to a different tendering outcome that the partial offer described above. Be sure to explain why the outcome is different. (Note: assume that if the bidder acquires control in the first stage of the two-tier offer, target shareholders who refuse to tender in the second stage of the offer can be forced, in a back-end merger, to accept a price equal to the second-stage price