This article explains some basic defense strategies that can be used by the management of potential target companies to deter unwanted acquisition advances.
Mergers and acquisitions (abbreviated M&A) refers to the aspect of corporate strategy, corporate finance and management dealing with the buying, selling, dividing and combining of different companies and similar entities that can help an enterprise grow rapidly in its sector or location of origin, or a new field or new location.
Mergers and acquisitions refer to the corporate strategy of buying, selling, and combining companies. There are several types of M&A transactions. A merger occurs when two companies combine to form a single new company, while an acquisition happens when one company purchases another. Mergers and acquisitions can be financed through cash payments, borrowing, issuing bonds, or offering stock in the acquiring company. Accurate business valuations are important for determining the purchase price in an M&A deal.
Private equity firms conduct leveraged buyouts (LBOs) by using the target company's assets as collateral to secure loans to purchase the target. This allows the acquirer to purchase the target using mostly borrowed funds. There are various types of LBOs with different objectives, such as repackaging the target company and returning it to public markets, dismantling and selling off parts of a conglomerate target, using leverage to build up a company through acquisitions, or borrowing funds for management to try saving a failing company. LBOs can potentially benefit shareholders through higher sale prices and employees by saving jobs, but they also carry risks like large debt loads that could bankrupt the combined entity if cash flows are insufficient.
The document discusses various aspects of corporate restructuring through mergers and acquisitions. It defines different types of mergers such as mergers, acquisitions, and consolidations. It also describes friendly and unfriendly takeover procedures. Reasons for mergers include synergies, growth, diversification, and economies of scale. Defensive tactics that target companies use to resist takeovers are also outlined.
This document provides an overview of merger and acquisition defense strategies adopted by companies. It discusses steps a potential bidder may take before making an offer such as conducting due diligence on the target. It also outlines various bid tactics a potential acquirer may use such as a toehold, tender offer, proxy contest or open market purchase. The document then examines different defense strategies a target company may adopt, including "shark repellents", selling valuable assets, and establishing severance packages for employees. It analyzes the Arcelor-Mittal takeover case study and market reactions to various defense tactics.
The document discusses mergers and acquisitions (M&A). It describes how M&A can create synergies that allow combined companies to have enhanced cost efficiencies, such as staff reductions, economies of scale in purchasing, acquiring new technologies, and improved market reach. It also categorizes different types of mergers like horizontal, vertical, market-extension, and product-extension. The document then discusses leveraged buyouts and common buyout scenarios like the repackaging plan, split-up, portfolio plan, and savior plan. Finally, it outlines the history of M&A in five waves from the late 1800s to the present.
This document provides an overview of mergers and acquisitions. It discusses various forms of restructuring like expansions, sell-offs, and changes in ownership structure. It also describes different types of mergers like horizontal, vertical, and conglomerate mergers. The document outlines reasons for merger movements in the late 19th century, 1920s, 1940s-1950s, and 1960s-1970s, often linked to economic and technological changes. It discusses the impacts of M&A activity on industry concentration. Finally, it briefly touches on risk arbitrage related to M&A deals.
The Venture Capital Financing Process: Term Sheet Negotiation. Presentation for entrepreneurs on the legal process of term sheet negotiation with Venture Capitalists.
Mergers and acquisitions (abbreviated M&A) refers to the aspect of corporate strategy, corporate finance and management dealing with the buying, selling, dividing and combining of different companies and similar entities that can help an enterprise grow rapidly in its sector or location of origin, or a new field or new location.
Mergers and acquisitions refer to the corporate strategy of buying, selling, and combining companies. There are several types of M&A transactions. A merger occurs when two companies combine to form a single new company, while an acquisition happens when one company purchases another. Mergers and acquisitions can be financed through cash payments, borrowing, issuing bonds, or offering stock in the acquiring company. Accurate business valuations are important for determining the purchase price in an M&A deal.
Private equity firms conduct leveraged buyouts (LBOs) by using the target company's assets as collateral to secure loans to purchase the target. This allows the acquirer to purchase the target using mostly borrowed funds. There are various types of LBOs with different objectives, such as repackaging the target company and returning it to public markets, dismantling and selling off parts of a conglomerate target, using leverage to build up a company through acquisitions, or borrowing funds for management to try saving a failing company. LBOs can potentially benefit shareholders through higher sale prices and employees by saving jobs, but they also carry risks like large debt loads that could bankrupt the combined entity if cash flows are insufficient.
The document discusses various aspects of corporate restructuring through mergers and acquisitions. It defines different types of mergers such as mergers, acquisitions, and consolidations. It also describes friendly and unfriendly takeover procedures. Reasons for mergers include synergies, growth, diversification, and economies of scale. Defensive tactics that target companies use to resist takeovers are also outlined.
This document provides an overview of merger and acquisition defense strategies adopted by companies. It discusses steps a potential bidder may take before making an offer such as conducting due diligence on the target. It also outlines various bid tactics a potential acquirer may use such as a toehold, tender offer, proxy contest or open market purchase. The document then examines different defense strategies a target company may adopt, including "shark repellents", selling valuable assets, and establishing severance packages for employees. It analyzes the Arcelor-Mittal takeover case study and market reactions to various defense tactics.
The document discusses mergers and acquisitions (M&A). It describes how M&A can create synergies that allow combined companies to have enhanced cost efficiencies, such as staff reductions, economies of scale in purchasing, acquiring new technologies, and improved market reach. It also categorizes different types of mergers like horizontal, vertical, market-extension, and product-extension. The document then discusses leveraged buyouts and common buyout scenarios like the repackaging plan, split-up, portfolio plan, and savior plan. Finally, it outlines the history of M&A in five waves from the late 1800s to the present.
This document provides an overview of mergers and acquisitions. It discusses various forms of restructuring like expansions, sell-offs, and changes in ownership structure. It also describes different types of mergers like horizontal, vertical, and conglomerate mergers. The document outlines reasons for merger movements in the late 19th century, 1920s, 1940s-1950s, and 1960s-1970s, often linked to economic and technological changes. It discusses the impacts of M&A activity on industry concentration. Finally, it briefly touches on risk arbitrage related to M&A deals.
The Venture Capital Financing Process: Term Sheet Negotiation. Presentation for entrepreneurs on the legal process of term sheet negotiation with Venture Capitalists.
A term sheet is a non-binding document that outlines the basic terms of a proposed investment in a company, including valuation, investment amount, ownership stakes, rights, and other key issues. It serves as a template for a binding legal agreement and helps ensure both parties understand the deal terms before incurring legal costs. The term sheet specifies important clauses such as liquidation preference, which dictates how funds are distributed in an exit event, as well as anti-dilution protection, drag along rights, and option pools that allocate ownership stakes to employees.
This document provides an overview and agenda for a chapter on mergers and acquisitions. It begins with learning objectives that cover the different types of acquisitions, how friendly and hostile acquisitions proceed, and where acquisition gains may be found. It then defines important terms and covers types of takeovers such as mergers, acquisitions, and amalgamations. It also discusses securities legislation pertaining to takeovers, the processes for friendly and hostile acquisitions, defensive tactics, and motivations for mergers and acquisitions focusing on creating synergy.
This document discusses mergers and acquisitions (M&A). It defines mergers and acquisitions, compares the two, and outlines some potential consequences. Mergers occur when two similar-sized companies combine, while acquisitions involve one company purchasing another. Mergers can create value through synergies but also carry risks like culture clashes. M&A activity aims to boost revenue, cut costs, and realize tax benefits, but over 70% of cross-border deals fail due integration challenges.
This chapter discusses mergers and acquisitions. It defines key terms like takeover, acquisition, and merger. It explains the different types of takeovers including cash and share transactions. It outlines securities laws around takeovers, including critical shareholder percentage thresholds. The chapter compares friendly and hostile acquisitions and the typical processes for each. It also discusses motivations for mergers and acquisitions like creating synergies through economies of scale or scope.
The document discusses mergers and acquisitions. It defines mergers as a transaction where two firms integrate operations to create a stronger competitive advantage. It describes different types of mergers such as horizontal, vertical, conglomerate, market extension, and product extension mergers. Acquisitions are defined as one company purchasing another. The key difference between mergers and acquisitions is that mergers form a new company while acquisitions do not. Synergy effects are cited as a driving force behind M&A deals. The regulatory framework around M&As in India is also summarized.
This document provides an overview of mergers and acquisitions. It defines mergers as a transaction where two firms integrate operations on an equal basis to create stronger competitive advantages. Acquisitions involve one company being bought by another. The document outlines key differences between mergers and acquisitions. It also discusses reasons for mergers and acquisitions as well as potential problems. Several major merger and acquisition deals are presented as examples. The process, impacts, and reasons for failure of mergers and acquisitions are summarized.
Ensure Your Business is fully ProtectedLegalWiz.in
Term Sheets are a vital document. It forms the base for contracts or agreements. Be aware and fully informed about the relevant details and clauses involved.
If your business has a corporate board or advisory
committee, you should consider protecting your assets with
D & O insurance. Many people think that only publicly traded
companies require D & O Insurance. In fact, public, private,
and even non-profit organization can face D & O litigation
risks.
The document provides an overview of mergers and acquisitions (M&As), including the objectives, types, and procedures involved in structuring an M&A transaction. It discusses various types of M&As such as horizontal, vertical, and conglomerate mergers. The procedures involved in an M&A deal include developing a business plan, conducting due diligence, negotiating the terms, financing the deal, developing an integration plan, and closing the transaction. Key participants in an M&A deal include investment bankers, lawyers, accountants, valuation experts, and institutional investors.
Comparative study of the takeover regulations prevailing in different countriesRamnath Srinivasan
This document provides an overview of takeover regulations in different countries by comparing concepts in India, the UK, Singapore, and the EC directive. It discusses definitions of key concepts like persons acting in concert and control. It notes differences, such as India uniquely including "common objective" in its definition of persons acting in concert. The document also compares threshold limits that trigger open offer requirements in different jurisdictions.
Stocks represent ownership shares in a company and allow shareholders to receive dividends from company profits. Bonds are loans made to companies or governments in exchange for regular interest payments and repayment of the principal at maturity. There are different types of stocks like common stock, which owners can sell on the open market, and preferred stock, which pays regular dividends but offers less potential for capital gains. A merger combines two or more companies, which governments try to limit to preserve competition.
Business combinations occur when two or more companies join together under common control. They form to achieve common objectives like growth, cost reduction, diversification, and tax benefits. There are different types of combinations including horizontal, vertical, conglomerate, and circular combinations. Companies combine through asset or stock acquisitions, mergers, or consolidations. The combined company may preserve separate legal entities or create an entirely new entity. Businesses combine to address issues like competition and business cycles or to achieve economies of scale.
The document discusses various types of mergers and acquisitions including horizontal, vertical, conglomerate, and concentric mergers. It provides examples for each type and explains their key characteristics. Some benefits of mergers include diversification, increased capacity and market share. However, mergers can fail due to issues with cultural integration, communication, and management. Acquisitions differ from mergers in that one company clearly takes ownership of another. Acquisitions aim to achieve economies of scale, staff reductions, new technology, and market reach. Hostile takeovers are strongly resisted while friendly takeovers have management agreement. Firms undertake takeovers to gain market growth, economies of scale, and complementing skills.
competition and its types, ways of competition.
determination of dominant position.
regulation of combinations, competition advocacy.
exceptions and risks- impact on companies.
Merger and acquisition shareholder value maximization and its legalArthur Mboue
The document discusses various aspects of mergers and acquisitions including:
1) Why an M&A advisor must master corporate finance to properly advise clients, deal with legal cases involving valuation, and comply with the duty of care.
2) The different types of acquisition agreements and how they impact ownership status.
3) The key steps in a bidding war for a target company including establishing a motive, choosing a target through due diligence, valuing the target, deciding on a payment method, and determining bidding parameters.
The document provides definitions and explanations of various financial terms:
1) Dematerialization is the move from physical stock certificates to electronic record keeping, while rematerialization is a compiler optimization that recomputes values instead of loading them from memory.
2) Venture capital refers to money available for investment in innovative or high-risk enterprises, especially in high technology.
3) An institutional investor is a large non-bank entity like a pension fund or hedge fund that qualifies for lower trading commissions due to the size of its transactions.
4) Insider trading is the illegal buying or selling of securities based on non-public information.
This document provides an introduction to business combinations and the conceptual framework. It outlines 10 learning objectives related to business combinations, including describing historical trends in types of combinations, identifying reasons firms combine, and factors to consider in due diligence. It also defines key terms like asset acquisitions, stock acquisitions, and mergers. The document contains examples and review questions to illustrate the concepts.
A takeover occurs when one business acquires a controlling interest in another, resulting in a change of ownership. There are two main types of takeovers: friendly takeovers where management agrees to a merger, and hostile takeovers which are strongly resisted. Mergers combine two separate businesses into a new entity through an exchange of stock. Both takeovers and mergers allow companies to expand, gain efficiencies, and create value, but they also carry high costs and risks of integration failures if cultures clash.
Legal aspects of mergers and acquisition
Acquisition is the combination of two companies where one corporation is completely absorbed by another corporation. The less important company loses its identity and becomes part of the more important corporation, which retains its identity. It may involve absorption or consolidation.
Merger is also defined as amalgamation. Merger is the fusion of two or more existing companies. All assets, liabilities and the stock of one company stand transferred to Transferee Company in consideration of payment in the form of:
I) Equity shares in the transferee company,
II) Debentures in the transferee company,
III) Cash, or
IV) A mix of the above mode
A Case study on mergers and acquisitions
we have in the folder - Types of Acquisitions what all is required for an acquisition and the legal aspects for it.
Also, Advantages and disadvantages of Mergers and Acquisition (M&A)
Mergers and acquisitions (M&A) refer to the aspect of corporate strategy dealing with buying, selling, and combining companies. There are several types of M&A transactions, including mergers, acquisitions, and asset purchases. Motives for M&A include achieving economies of scale, increasing market share, cross-selling opportunities, and tax advantages. However, M&A also carry risks such as overpayment, cultural clashes, and failure to achieve expected synergies.
A term sheet is a non-binding document that outlines the basic terms of a proposed investment in a company, including valuation, investment amount, ownership stakes, rights, and other key issues. It serves as a template for a binding legal agreement and helps ensure both parties understand the deal terms before incurring legal costs. The term sheet specifies important clauses such as liquidation preference, which dictates how funds are distributed in an exit event, as well as anti-dilution protection, drag along rights, and option pools that allocate ownership stakes to employees.
This document provides an overview and agenda for a chapter on mergers and acquisitions. It begins with learning objectives that cover the different types of acquisitions, how friendly and hostile acquisitions proceed, and where acquisition gains may be found. It then defines important terms and covers types of takeovers such as mergers, acquisitions, and amalgamations. It also discusses securities legislation pertaining to takeovers, the processes for friendly and hostile acquisitions, defensive tactics, and motivations for mergers and acquisitions focusing on creating synergy.
This document discusses mergers and acquisitions (M&A). It defines mergers and acquisitions, compares the two, and outlines some potential consequences. Mergers occur when two similar-sized companies combine, while acquisitions involve one company purchasing another. Mergers can create value through synergies but also carry risks like culture clashes. M&A activity aims to boost revenue, cut costs, and realize tax benefits, but over 70% of cross-border deals fail due integration challenges.
This chapter discusses mergers and acquisitions. It defines key terms like takeover, acquisition, and merger. It explains the different types of takeovers including cash and share transactions. It outlines securities laws around takeovers, including critical shareholder percentage thresholds. The chapter compares friendly and hostile acquisitions and the typical processes for each. It also discusses motivations for mergers and acquisitions like creating synergies through economies of scale or scope.
The document discusses mergers and acquisitions. It defines mergers as a transaction where two firms integrate operations to create a stronger competitive advantage. It describes different types of mergers such as horizontal, vertical, conglomerate, market extension, and product extension mergers. Acquisitions are defined as one company purchasing another. The key difference between mergers and acquisitions is that mergers form a new company while acquisitions do not. Synergy effects are cited as a driving force behind M&A deals. The regulatory framework around M&As in India is also summarized.
This document provides an overview of mergers and acquisitions. It defines mergers as a transaction where two firms integrate operations on an equal basis to create stronger competitive advantages. Acquisitions involve one company being bought by another. The document outlines key differences between mergers and acquisitions. It also discusses reasons for mergers and acquisitions as well as potential problems. Several major merger and acquisition deals are presented as examples. The process, impacts, and reasons for failure of mergers and acquisitions are summarized.
Ensure Your Business is fully ProtectedLegalWiz.in
Term Sheets are a vital document. It forms the base for contracts or agreements. Be aware and fully informed about the relevant details and clauses involved.
If your business has a corporate board or advisory
committee, you should consider protecting your assets with
D & O insurance. Many people think that only publicly traded
companies require D & O Insurance. In fact, public, private,
and even non-profit organization can face D & O litigation
risks.
The document provides an overview of mergers and acquisitions (M&As), including the objectives, types, and procedures involved in structuring an M&A transaction. It discusses various types of M&As such as horizontal, vertical, and conglomerate mergers. The procedures involved in an M&A deal include developing a business plan, conducting due diligence, negotiating the terms, financing the deal, developing an integration plan, and closing the transaction. Key participants in an M&A deal include investment bankers, lawyers, accountants, valuation experts, and institutional investors.
Comparative study of the takeover regulations prevailing in different countriesRamnath Srinivasan
This document provides an overview of takeover regulations in different countries by comparing concepts in India, the UK, Singapore, and the EC directive. It discusses definitions of key concepts like persons acting in concert and control. It notes differences, such as India uniquely including "common objective" in its definition of persons acting in concert. The document also compares threshold limits that trigger open offer requirements in different jurisdictions.
Stocks represent ownership shares in a company and allow shareholders to receive dividends from company profits. Bonds are loans made to companies or governments in exchange for regular interest payments and repayment of the principal at maturity. There are different types of stocks like common stock, which owners can sell on the open market, and preferred stock, which pays regular dividends but offers less potential for capital gains. A merger combines two or more companies, which governments try to limit to preserve competition.
Business combinations occur when two or more companies join together under common control. They form to achieve common objectives like growth, cost reduction, diversification, and tax benefits. There are different types of combinations including horizontal, vertical, conglomerate, and circular combinations. Companies combine through asset or stock acquisitions, mergers, or consolidations. The combined company may preserve separate legal entities or create an entirely new entity. Businesses combine to address issues like competition and business cycles or to achieve economies of scale.
The document discusses various types of mergers and acquisitions including horizontal, vertical, conglomerate, and concentric mergers. It provides examples for each type and explains their key characteristics. Some benefits of mergers include diversification, increased capacity and market share. However, mergers can fail due to issues with cultural integration, communication, and management. Acquisitions differ from mergers in that one company clearly takes ownership of another. Acquisitions aim to achieve economies of scale, staff reductions, new technology, and market reach. Hostile takeovers are strongly resisted while friendly takeovers have management agreement. Firms undertake takeovers to gain market growth, economies of scale, and complementing skills.
competition and its types, ways of competition.
determination of dominant position.
regulation of combinations, competition advocacy.
exceptions and risks- impact on companies.
Merger and acquisition shareholder value maximization and its legalArthur Mboue
The document discusses various aspects of mergers and acquisitions including:
1) Why an M&A advisor must master corporate finance to properly advise clients, deal with legal cases involving valuation, and comply with the duty of care.
2) The different types of acquisition agreements and how they impact ownership status.
3) The key steps in a bidding war for a target company including establishing a motive, choosing a target through due diligence, valuing the target, deciding on a payment method, and determining bidding parameters.
The document provides definitions and explanations of various financial terms:
1) Dematerialization is the move from physical stock certificates to electronic record keeping, while rematerialization is a compiler optimization that recomputes values instead of loading them from memory.
2) Venture capital refers to money available for investment in innovative or high-risk enterprises, especially in high technology.
3) An institutional investor is a large non-bank entity like a pension fund or hedge fund that qualifies for lower trading commissions due to the size of its transactions.
4) Insider trading is the illegal buying or selling of securities based on non-public information.
This document provides an introduction to business combinations and the conceptual framework. It outlines 10 learning objectives related to business combinations, including describing historical trends in types of combinations, identifying reasons firms combine, and factors to consider in due diligence. It also defines key terms like asset acquisitions, stock acquisitions, and mergers. The document contains examples and review questions to illustrate the concepts.
A takeover occurs when one business acquires a controlling interest in another, resulting in a change of ownership. There are two main types of takeovers: friendly takeovers where management agrees to a merger, and hostile takeovers which are strongly resisted. Mergers combine two separate businesses into a new entity through an exchange of stock. Both takeovers and mergers allow companies to expand, gain efficiencies, and create value, but they also carry high costs and risks of integration failures if cultures clash.
Legal aspects of mergers and acquisition
Acquisition is the combination of two companies where one corporation is completely absorbed by another corporation. The less important company loses its identity and becomes part of the more important corporation, which retains its identity. It may involve absorption or consolidation.
Merger is also defined as amalgamation. Merger is the fusion of two or more existing companies. All assets, liabilities and the stock of one company stand transferred to Transferee Company in consideration of payment in the form of:
I) Equity shares in the transferee company,
II) Debentures in the transferee company,
III) Cash, or
IV) A mix of the above mode
A Case study on mergers and acquisitions
we have in the folder - Types of Acquisitions what all is required for an acquisition and the legal aspects for it.
Also, Advantages and disadvantages of Mergers and Acquisition (M&A)
Mergers and acquisitions (M&A) refer to the aspect of corporate strategy dealing with buying, selling, and combining companies. There are several types of M&A transactions, including mergers, acquisitions, and asset purchases. Motives for M&A include achieving economies of scale, increasing market share, cross-selling opportunities, and tax advantages. However, M&A also carry risks such as overpayment, cultural clashes, and failure to achieve expected synergies.
Corporations obtain financial resources from two main sources: shareholders and debt holders. Shareholders are concerned with maximizing the firm's value and their return, while debt holders focus on the firm's ability to repay principal and interest. There are agency problems that arise between these groups due to the separation of ownership and control of corporations. Managers may make decisions that benefit themselves over shareholders. Debt holders also conflict with shareholders if risky projects are undertaken that could jeopardize the firm's solvency. Efficient solutions aim to align the interests of all parties.
This document discusses mergers and acquisitions (M&As) in corporate America. It notes that M&A activity spiked in the mid-1980s and 1990s due to availability of financing, and decreased in the early 2000s during an economic recession. The types and reasons for M&As are described, including improving synergies, diversifying, increasing market power and growth. Takeovers can be friendly or hostile. Defensive strategies by target firms against takeovers are also outlined, including poison pills and antitakeover laws. While takeovers may discipline underperforming managers, defenses can also benefit shareholders by increasing bid prices.
This document discusses strategies for defending against hostile takeovers. It begins by outlining warning signs that a takeover may be impending. It then describes several preventative measures companies can take, such as controlling access to shareholder registers and increasing debt, to deter potential acquirers. Finally, it outlines reactive defenses that can be employed once a takeover attempt is underway, like litigation, share buybacks ("Pac-Man defense"), and recruiting a friendly acquirer ("White Knight"). The overall message is that advance preparation and flexibility are key to successfully defending against a hostile takeover.
The document provides an overview of mergers and acquisitions. It defines mergers and acquisitions, outlines the key differences between them, and describes the typical procedures involved. Some of the main advantages and motives for mergers and acquisitions discussed are achieving economies of scale, increasing market share and revenue, enabling cross-selling opportunities between companies, realizing synergies from specialization, and seeking tax benefits. The document also provides examples of major mergers and acquisitions deals.
The document discusses mergers and acquisitions (M&A) in business. It defines key terms like merger, acquisition, and takeover. It outlines the procedure for M&A and compares provisions under the Companies Act of 1956 and 2013. It discusses types of mergers like friendly, reverse, and hostile takeovers. It provides a case study and principles for sanctioning an M&A scheme. Overall, the document provides an overview of M&A processes and regulations in India.
Acquisition_ An Opportunity to Acquire Budding Businesses in India 1.pdfmyLawyerAdvise
On the surface, an acquisition might look beneficial in terms of improving the long-term growth and profits only of the acquirer. However, a carefully structured and negotiated deal can have unending advantages for the target company, too. For example, in the aftermath of the first and second wave of COVID-19, where companies have become vulnerable to corporate dissolution, are suffering from shortage of funds, or are under the pressure of banks, getting acquired is the best option available to them. This option gives the sellers an opportunity to get themselves out of debt, protect the interest of their customers, employees, and also get some money from the deal. However, businesses fail where they wait ‘until it’s too late’ and everyone faces the brunt of it.
M&A - Merger and Acquisition Joseph F Valencia_MBAJoseph Valencia
Mergers and acquisitions (M&A) is a general term that refers to the consolidation of companies or assets. M&A can include a number of different transactions, such as mergers, acquisitions, consolidations, tender offers, purchase of assets and management acquisitions.
The current soft insurance market provides a good opportunity for agencies to create captive insurance companies. Captives can generate underwriting profits and investment income for agencies. They also allow agencies more control over their business partnerships with carriers. By taking advantage of Section 831(b), agency captives' underwriting profits may be exempt from federal taxes if annual premiums do not exceed $1.2 million. Waiting until the next hard market reduces opportunities agencies have now to partner with carriers and develop new profit strategies using a captive. The best time for agencies to start exploring a captive strategy is during the current soft market conditions.
Corporate restructuring study material-final (2)Haridas Karath
This document provides an overview of various types of corporate restructuring transactions under Indian law. It begins by discussing mergers and amalgamations, noting the technical differences between the two but their common use. It then covers the different types of mergers (horizontal, vertical, congeneric, and conglomerate), as well as cash mergers and triangular mergers. Next, it discusses acquisitions, including friendly takeovers, hostile takeovers, and leveraged buyouts. It also mentions bailout takeovers. Finally, it briefly outlines strategic alliances, joint ventures, and demergers as other forms of corporate restructuring.
Acquisition,Merger,Take-over and global strategy by Navid RoyNavidroy
The document summarizes information about acquisitions and takeovers. It discusses the differences between acquisitions, mergers, and joint ventures. It also describes friendly takeovers, hostile takeovers, reverse takeovers, and backflip takeovers. Additionally, it covers reasons for acquisitions including increased market power, overcoming entry barriers, and diversification. Finally, it discusses problems that can occur with acquisitions and integration as well as pros and cons of takeovers.
Mergers and acquisitions framework | Veristrat Inc.Veristrat Inc
Mergers and Acquisitions : Amergerisacombinationoftwoormorecompanieswhereonecorporationiscompletelyabsorbedbyanothercorporation. Acquisition essentially means 'to acquire’ or ‘to takeover’.
The document discusses mergers and acquisitions from multiple perspectives:
- It outlines some of the key advantages and disadvantages of mergers and acquisitions, such as allowing shareholders to own a piece of a larger company or potential clashes of company cultures.
- It then explains different types of mergers and acquisitions like vertical, horizontal, conglomerate, and circular combinations.
- Next, it introduces a five stage model of mergers and acquisitions that includes corporate strategy development, organizing for acquisitions, deal structuring, post-acquisition integration, and post-acquisition audits.
- It also discusses how synergies can be created through mergers and acquisitions by improving financial performance, providing
The document is a newsletter from the law firm Tharpe & Howell summarizing recent business law developments. It discusses several court cases related to personal guarantees, maintaining corporate separateness, employer liability for cyberbullying, and tenant waivers. It also provides information on new personal guarantee insurance, the proposed Cybersecurity Act of 2012, and vicarious liability when a special relationship exists.
This document discusses takeovers in India. It defines a takeover as the acquisition of control of one company by another through the purchase of shares. There are different types of takeovers, including friendly/negotiated takeovers, hostile takeovers, and bailout takeovers. The key terms related to takeovers are also defined, such as acquirer, target company, control, promoter, and persons acting in concert. The document then discusses a historical example of Larsen & Toubro's cement business being acquired by Grasim Industries in a demerger transaction.
Software product capabilities presentation.
This software application is available on Amazon.com.
Keyword search "residential real estate software" to subscribe.
2022-Biennial Compilation of Housing Research.pptxTroy Adkins
This document summarizes housing and economic reports from 2021 and 2022. It discusses the Federal Reserve maintaining interest rates near 0% in 2021 and gradually raising them in 2022. Reports reviewed include the state of the housing market, access to lending, issues in residential construction, household debt levels, and the ongoing government conservatorship of Freddie Mac and Fannie Mae since the 2008 financial crisis. Mortgage interest rates increased over the year from an average of 3.2% to 6.73% for a 30-year fixed rate loan.
The purpose of this presentation is for the founder of Adkins Capital Management (ACM) to provide an overview and assessment of:
The events and trends that have transpired in the U.S. residential housing market for the second quarter of 2023:
A review of “The State of The Nation’s Housing” report by the Joint Center for Housing Studies (JCHS) of Harvard University.
The monetary policy actions of the Federal Reserve to help curtail the impact of inflation on the U.S. economy.
The home price level for a select group of cities that make up the Adkins 60-City Home Price Index:
Top Five Overpriced Cities in the U.S.; and
Top Five Underpriced Cities in the U.S.
This document provides an overview and analysis of reverse mortgage loans in the United States. It discusses the history and key features of reverse mortgages, including eligibility criteria, loan disbursement options, and how the amount that can be borrowed is determined based on the homeowner's age and interest rates. The document also analyzes the various costs associated with reverse mortgages, such as origination fees, mortgage insurance premiums, interest expense, and servicing fees. It provides examples of how these costs are calculated and can accumulate over the life of the loan.
The document provides an overview and assessment of the U.S. residential housing market for the third quarter of 2020 by Adkins Capital Management. It summarizes unexpected increases in new and existing home sales despite the pandemic and economic impacts. It also analyzes the Federal Reserve's monetary policy actions in response. Additionally, it identifies the top five most overpriced and underpriced cities based on an analysis of each city's median home price, household income, and justified mortgage interest rate. The document concludes by encouraging prospective home buyers to use its valuation tools to make prudent home purchasing decisions.
The document discusses the rise of Bitcoin as a digital currency and payment system. It outlines some of the innovations and obstacles facing wider adoption of Bitcoin, including its increasing popularity and market value, as well as legal and regulatory issues in different countries. System issues with Bitcoin's complexity and the mining process are also examined, along with how exchange traded funds could help further its acceptance but may not be necessary given Bitcoin's existing structure. In the end, the document suggests that while technical and regulatory challenges remain, it is possible Bitcoin could develop into a widely supported global currency system over time.
2019 and 2020 biennial compilation of housing researchTroy Adkins
The document summarizes key housing and mortgage market events and reports from 2020 and 2019, including:
1) Several major banks were accused of price-fixing Fannie Mae and Freddie Mac bonds.
2) Reports from the Joint Center for Housing Studies of Harvard University on the state of the nation's housing and biennial compilation of pertinent housing research.
3) Actions by the U.S. Federal Reserve to reduce interest rates in response to the COVID-19 pandemic economic impact.
The purpose of this presentation is to provide an overview of the U.S. residential housing market for the second quarter of 2018. An overview of the State of the Nation's Housing by the Joint Center for Housing Studies of Harvard University is covered in this presentation.
The following presentation provides a residential housing analysis for the City of Houston, Texas as of March, 2018. Prospective home buyers should consider using our cloud-based software application in order to assist them in making a prudent home purchase decision.
2017 Q1 - U.S. Residential Housing Marketing ReviewTroy Adkins
The purpose of this presentation is to provide an overview of the events and trends that transpired in the U.S. residential housing market for during the first quarter of 2017, and to provide an overview of the top five over-priced cities and under-priced cities that make up the Adkins 60-City Home Price Index.
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The following slide is a summary of the pertinent housing issues for 2015 and 2016. For more information, visit the Adkins Capital Management website in order to watch our comprehensive housing movie presentations.
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This document explains the issues associated with obtaining software patent authorization by the United States Patent and Trademark Office as a result of the SCOTUS decision in Alice Corporation versus CLS Bank International.
The purpose of this video is to provide an overview of the recent events and trends that have transpired in the residential housing environment, and to provide an overview of the home-price level for a select group of cities that make up the Adkins 60-City Home Price Index. This analysis is for the second quarter of 2015.
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The following presentation provides an overview of the events and trends that took place in the residential housing environment for the first quarter of 2015 and provides an overview of the home price level for a select group of cities throughout the United States.
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Warding Off Hostile Takeovers
1. Warding Off Hostile Takeovers
April 19, 2013 | By Troy M. Adkins II
A corporate takeover is a complex business transaction pertaining to one company purchasing another company.
Corporate takeovers typically take place for many logical reasons, including anticipated synergies between the
acquiring company and target company, potential for significant revenue enhancements, likely reduced operating
costs and beneficial tax considerations. In the U.S., most corporate takeovers are friendly in nature, meaning that the
majority of key stakeholders support the acquisition. However, for many reasons, potential corporate takeovers can
become hostile. With this in mind, some basic defense strategies can be used by the management of potential target
companies to deter unwanted acquisition advances.
Overview of the Williams Act of 1968
Hostile corporate takeover attempts typically take place when a potential acquirer makes a tender offer, or direct
offer, to the stockholders of the target company. This process happens over the opposition of the target company’s
management, and it usually leads to significant tension between the target company’s management and that of the
acquirer. In response to such practice, Congress passed the Williams Act to offer full and fair disclosure to
shareholders of the potential target companies, and to establish a mechanism that gives additional time for the
acquiring company to explain the acquisition’s purpose.
The Williams Act requires the acquiring company to disclose to the Securities and Exchange Commission the source
of funds that will be used to accomplish the acquisition, the purpose for which the offer is being made, the plans the
acquirer would have if it is successful in the acquisition, and any contracts or understandings concerning the target
corporation. While the Williams Act was designed to make the corporate takeover process more orderly, the
increased use of derivative securities have made the Act a less useful defense mechanism. As a result, both
preemptive and responsive corporate defense strategies need to be considered by the management of companies
likely to be targeted for acquisition.
Preemptive Corporate Takeover Defense Strategies
These types of strategies can be put in place by a company’s management to ward off potential takeovers before the
target company is identified as a potential candidate for acquisition. A company can put in place many types of
preemptive defense strategies to mitigate an attempted corporate takeover.
A first preemptive line of defense against a hostile corporate takeover would be to establish stock securities that
2. have differential voting rights (DVRs). Stocks with this type of provision provide fewer voting rights to
shareholders. For example, holders of these types of securities may need to own 100 shares to be able to cast one
vote. U.S. companies that issue stock with DVRs include Viacom and News Corp. It is anticipated that such
securities will gain more popularity in the future, as DVRs not only help provide protection against hostile
takeovers, but they typically trade at a discount relative to company stock and they pay a higher dividend. As a
result, DVR shares are attractive securities to a variety of investors.
A second preemptive line of defense against a hostile corporate takeover would be to establish an employee stock
ownership plan. An ESOP is a tax-qualified retirement plan that offers tax savings to both the corporation and its
shareholders. By establishing an ESOP, employees of the corporation hold ownership in the company. This, in turn,
means that a greater percentage of the company will likely be owned by people that will vote in conjunction with the
views of the target company’s management rather than with the interests of a potential acquirer. There were 11,400
ESOPs in the U.S. in early 2009 and more than 13 million employees participating in such plans. The supermarket,
construction and engineering industries are represented by many companies with an ESOP plan. A couple of
America’s largest employee-owned companies include Publix Supermarkets, which employs 158,000 people, and
Parsons, a construction and engineering firm, which is owned by its 11,500 employees.
Responsive Corporate Takeover Defense Strategies
These types of strategies can be implemented by a company after it has been identified as a potential acquisition
target by a prospective acquirer. A company can put in place many types of responsive defense strategies to mitigate
an attempted corporate takeover.
A first responsive line of defense against a hostile corporate takeover would be to establish a poison pill provision
that could be used to ward off or deter prospective acquirers. One type of poison pill would allow existing
shareholders, excluding the acquirer, the right to purchase the target’s stock at a price considerably below its market
value. By allowing existing shareholders to purchase additional shares at a discounted price, the shares held by the
acquirer would become diluted, making the takeover transaction more unattractive and expensive. In 2012, such a
strategy was implemented when Carl Icahn announced that he had purchased nearly 10% of the shares of Netflix in
an attempt to take over the company. The Netflix board responded by instituting a shareholder-rights plan to make
any attempted takeover excessively costly. The terms of the plan stated that if anyone bought up 10% or more of the
company, the board would allow its shareholders to buy newly issued shares in the company at a discount, diluting
the stake of any would-be corporate raiders and making a takeover virtually impossible without approval from the
takeover target.
A second responsive corporate takeover defense strategy is the alliance of a target company with an investor known
as a white knight. When utilizing a white knight strategy, the target company seeks a preferred investor to acquire
3. the company. Typically, the white knight agrees to pay a premium above the acquirer’s offer to buy the target
company’s stock, or the white knight agrees to restructure the target company after the acquisition is completed in a
manner supported by the target company’s management. Classic examples of white knight engagements in the
corporate takeover process include PNC’s purchase of National City Corporation in 2008 to help the company
survive during the subprime mortgage lending crisis, and Fiat’s takeover of Chrysler in 2009 to save it from
liquidation..
A third responsive corporate takeover defense strategy is a concept known as greenmail. This refers to a targeted
repurchase, where a company buys a certain amount of its own stock from an individual investor, usually at a
substantial premium. These premiums can be thought of as payments to a potential acquirer to eliminate an
unfriendly takeover attempt. One of the first applied occurrences of this concept was in July 1979, when Carl Icahn
bought 9.9% of Saxon Industries stock for $7.21 per share. Subsequently, Saxon was forced to repurchase its own
shares at $10.50 per share to unwind the corporate takeover activity. While the anti-takeover process of greenmail is
effective, some companies, like Lockheed Martin, have implemented anti-greenmail provisions in their corporate
charters. Over the years, greenmail has diminished in usage due to the capital gains tax that is now imposed on the
gains derived from such hostile takeover tactics.
Conclusion
Corporations have many hostile takeover defense mechanisms at their disposal. Given the level of hostile corporate
takeovers that have taken place in the U.S. during the first part of this century, it may be prudent for management to
put in place preemptive corporate takeover mechanisms, even if their company is not currently being considered for
acquisition. Such policies should be seriously pursued by companies that have a well-capitalized balance sheet, a
conservative income statement that exhibits high profitability, an attractive cash flow statement and a large or
growing market share for its products or services. In addition, if the company exhibits significant barriers to entry, a
lack of competitive rivalry in the industry, a minimal threat of substitute products or services, minimal bargaining
power of the buyers and minimal bargaining power of the suppliers, the case for implementing preemptive hostile
strategies while developing a thorough understanding of responsive takeover defense mechanisms is highly advised.