Why might an acquirer want to maintain a target company as a separate legal entity and not

Question:

Why might an acquirer want to maintain a target company as a separate legal entity and not merge the target into one of its own subsidiaries or buy the target’s assets?

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Taxes And Business Strategy A Planning Approach

ISBN: 9780132752671

5th Edition

Authors: Myron Scholes, Mark Wolfson, Merle Erickson, Michelle Hanlon

See More Books

Question Posted: Aug 06, 2015 02:42 AM

See More Questions

Why might a firm want to maintain a high bond rating? What has been happening to bond ratings in recent years?
Joseph Smith, Amtrax's CFO wants to maintain a target debt-to-equity ratio of 1/4. If the WACC is 16.5%, and the pretax cost of debt is 8%, what is the cost of common equity assuming a tax rate of...
The Austin, Texas plant of Computer Products produces disk drives for personal and small business computers. Gerald Knox, the plants production planning director, is looking over next years sales...
If f (x, y, z) = 2xyz - 1 + x2z3, find the following. (a) f/x (b) f/y (c) f/z
The pie chart shows the distribution of how much married U.S. male adults trust their spouses to manage their finances. A financial services company claims that the distribution of how much married...
Billy Board Company specializes in the maintenance and repair of signs, such as billboards. On March 31, 2010, the accountant for Billy Board Company prepared the following trial balances:...
7. We now use Monte Carlo to simulate the behavior of the martingale Pt/St , with St as numeraire. Let x0 = P0(0, T )/S0. Simulate the process xt+h = (1+ hZt+h)xt Let h be approximately 1 day. a....
The fiscal year for Hokkaido Company ends on May 31. Results for the year ended May 31, 20X1, included the following (in millions of Japanese yen except for number of shares outstanding): Cash and...
Consider an American put option. Suppose its stock price is $50 and its strike price is $52. If the risk-free rate is 7% per annum with continuous compounding, the volatility is 32%, and the life of...
Planning is one of the most important management functions in any business. A front office managers first step in planning should involve determine the departments goals. Planning also includes...
Under what general circumstances is a tax- free acquisition structure preferable? Consider specifically the tax attributes and tax status of the target corporation and the targets shareholders. Also...
What are the tax benefits of using a Section 351 transfer of property to a controlled corporation? In what ways is it superior to a Section 368 reorganization?
If 2 denotes the variance of the population of all outside diameters that would be produced by the new machine: (1) Test H0: 2 = .0005 versus Ha: 2 < .0005 by setting equal to .05. (2) Find 95...
"New Push Ties Cost of Drugs to How Well they Work," by Loftus, and "Pay-For-Performance is No Miracle Cure," by Pauly; the authors make an argument that tying the price of a drug to its...
Entrepreneurs/entrepreneurship is a driving force of the U.S. economy. It has also provided great personal wealth to a host of entrepreneurs, past and present, who have dared to risk all for a dream....
Select a topic (the purpose) of your choice and persuade people (the audience) o As a starting point for topic ideas, consider selling a product, advertising an event, or sharing a thoughtful article...
What is java?
Find the equivalent mass of a spring under the assumption that the velocity distribution along the length of the spring is parabolic.
Tell whether the angles or sides are corresponding angles, corresponding sides, or neither. AC and JK
Construct a histogram for the data in Exercise 22. Explain how the histogram shows whether it is appropriate to treat this sample as coming from an approximately normal population. Exercise 22 A...
Regarding the gift-splitting provision of 2513, comment on the following. a. What it was designed to accomplish. b. How the election is made. c. The treatment of any taxable gifts previously made by...
Regarding the gift-splitting provision of 2513, comment on the following. a. What it was designed to accomplish. b. How the election is made. c. The treatment of any taxable gifts previously made by...
Regarding the gift-splitting provision of 2513, comment on the following. a. What it was designed to accomplish. b. How the election is made. c. The treatment of any taxable gifts previously made by...
Famas Llamas has a weighted average cost of capital of 8.8 percent. The companys cost of equity is 12 percent, and its pretax cost of debt is 6.8 percent. The tax rate is 22 percent. What is the...
The common stock of a company paid 1.32 in dividens last year. Dividens are expected to gros at an 8 percent annual rate for an indefinite number of years. A) If the company's current market price is...
(1 point) Bill makes annual deposits of $1900 to an an IRA earning 5% compounded annually for 14 years. At the end of the 14 years Bil retires. a) What was the value of his IRA at the end of 14...

Why might an acquirer want to maintain a target company as a separate legal entity and not

Question:

Step by Step Answer:

The acquirer may desire to keep the targets liabilities recorded and contingent in a separate ...View the full answer

Taxes And Business Strategy A Planning Approach

Students also viewed these Business Law questions