In bold, some would say risky move, Reebok at one time bought back nearly a third of its shares. This repurchase of shares dramatically reduced Reeboks available cash. In fact, the company borrowed significant funds to accomplish the repurchase. In a press release, management stated that it was repurchasing the shares because it believed its shares were severely underpriced. The repurchase of so many shares were meant to signal managements belief in good future earnings. Skeptics, a consultant, however, suggested that Reeboks management was repurchasing shares to make it less likely that another company would acquire Reebok. By depleting its cash, Reebok became less likely acquisition target. But, Reebok was eventually acquired by Adidas. You are required to answer the following questions: (A) Why did Reebok Company buy back its ordinary shares (buying back its own shares)? How repurchase shares are reported in the statement of equity? (5 Marks) (B) What signal might a share repurchase send to investors regarding managements belief about the companys growth opportunities? (5 Marks)