When does a company become captive to another firm?
Occurs when the corporation reduces the scope of some of its functional activities and becomes "captive" to another firm. c. Emphasizes improving operational efficiency and is appropriate when a corporation's problems are pervasive, but not yet critical.
What are the advantages of a corporation that experiences successful growth?
A corporation that experiences successful growth is thought of positively by the marketplace and potential investors. c. A large and growth oriented corporation has more clout and influence. d. A growing firm can cover up mistakes and inefficiencies because of the increase in cash flow revenue.
Are all divisions of a corporation at the same stage of development?
E) all divisions of a corporation must be at the same stage of development at the same time. Some support for the stages of international development, but not necessarily the sequence of stages.
When is divestment appropriate for a company?
a. A form of divestment and is appropriate when corporate problems can be traced to the poor performance of an SBU or product line. b. Occurs when the corporation reduces the scope of some of its functional activities and becomes "captive" to another firm.
Which external growth strategy involves two or more corporations joining in a stock exchange and from which only one corporation survives?
The answer is A) mergers. A merger entails combining two legal entities to create a completely new legal entity.
When a new corporation is formed to acquire two or more other corporations and the acquired corporations cease to exist as separate legal entities The result is a statutory?
merger. When a new corporation is formed to acquire two or more other corporations and the acquired corporations cease to exist as separate legal entities, the result is a statutory a.
Which strategy is frequently used in corporations?
The growth can be internal growth by diversification and external growth merger or joint ventures. Growth is accepted as the easiest way of life. All organizations look for expansion, thus expansion strategies are the most popular and common corporate strategies.
Is the purchase of a company that is completely absorbed as an operating subsidiary or division of the acquiring corporation?
CardsTerm Directional StrategyDefinition Firm's overall orientation toward growth, stability, or retrenchment.Term AcquisitionDefinition purchase of a company that is completely absorbed as an operating subsidiary or division of the acquiring corporation.98 more rows•Oct 30, 2011
When a corporation or two business entities combine to form one business it is called a merger?
True. When a corporation or two business entities combine to form one business, it is called a merger. True. A horizontal merger is a merger between firms in completely unrelated industries.
When two companies merge what is it called?
A merger is the voluntary fusion of two companies on broadly equal terms into one new legal entity. The five major types of mergers are conglomerate, congeneric, market extension, horizontal, and vertical.
What corporate strategy means?
Corporate strategy definition Corporate strategy is a unique plan or framework that is long-term in nature, designed with an objective to gain a competitive advantage over other market participants while delivering both on customer/client and stakeholder promises (i.e. shareholder value).
What is a corporate strategy in business?
Corporate strategy is the strategy level that concerns itself with the entirety of the organization, where decisions are made with regard to the overall growth and direction of a company. Corporate strategies are arguably the most essential and broad-ranging strategy level within an organizational strategy.
Which strategy will be used by an organization that is in more than one line of business?
Corporate strategy is formulated at the top level by the top management of a diversified company (in our country, a diversified company is popularly known, as 'group of companies', such as Alphabet Inc.). Such a strategy describes the company's overall direction in terms of its various businesses and product lines.
What is share acquisition?
An acquisition is when one company purchases most or all of another company's shares to gain control of that company. Purchasing more than 50% of a target firm's stock and other assets allows the acquirer to make decisions about the newly acquired assets without the approval of the company's other shareholders.
What is a corporate merger?
Merger: A contractual and statutory process by which one corporation (the surviving corporation) acquires all of the assets and liabilities of another corporation (the merged corporation), causing the merged corporation to become defunct.
What is full integration?
Something that fully expresses the intent of the parties. Thus, an oral discussion or written document is a complete integration if it captures the full agreement between the parties on some subject matter.
What does "take over" mean?
a. take over a function previously supplied by a former employer.
Why can a growing firm cover up mistakes and inefficiencies?
d. A growing firm can cover up mistakes and inefficiencies because of the increase in cash flow revenue.
What is the term for adding a related or complementary product to a corporation's business units?
54) Adding a related or complementary product to a corporation's business units is called A) concentration .
What is growth through diversification out of an industry into an unrelated industry called?
55) Growth through diversification out of an industry into an unrelated industry is called A) concentration.
Why can a growing firm cover up mistakes and inefficiencies?
D) A growing firm can cover up mistakes and inefficiencies because of the increase in cash flow revenue.
What happens when two or more corporations combine?
two or more corporations combine in such a way that each corporation ceases to exist and a new one emerges
Who files a surviving corporation's plan?
Once the plan is approved by the directors and the shareholders of both corporations, the surviving corporation files the plan with the appropriate official, usually the secretary of the state
How does a target company regain control?
To regain control, a target company may pay a higher-than-market price to repurchases all of the stock that the acquiring corporation bought. When a takeover is attempted through a gradual accumulation of target stock rather than a tender offer, the intent may be to induce the target company to buy back the shares at a premium price
What does a target corporation do when it takes over a company?
The target corporation issues to its stockholders rights to purchase additional shares at low prices when there is a takeover attempt. This makes the takeover undesirably or even prohibitively expensive for the acquiring corporation
What is the right of dissenting shareholders?
The law gives dissenting shareholders a statutory right to be paid the fair value of the shares they held on the date of the merger or consolidation. It extends to mergers, consolidations, share exchanges, and sales of substantially all of the corporate assets
What is a target corporation?
The target corporation . solicits a merger with a third party, which then makes a better tender offer to the target's shareholders.
What happens when a company is threatened with a takeover?
When threatened with a takeover, management makes the company less attractive to the raider by selling the company's most valuable asset to a third party
