alleryStart learning →Why is a large cash pile attractive to a takeover bidder?
AIt can repay bidder's debt
BCash lowers share price
CCash must be distributed
DCash is taxed heavily
Answer & Solution
Correct answer: A. It can repay bidder's debt
The bidder can use the target's own cash to pay down the debt taken on for the acquisition.
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Under Section 68, specified securities includeAfter a buy-back, a remaining investor's proportionate ownershipThe details of the transfer to capital redemption reserve are to be disclosed in the40,000 shares of face value Rs 5 are bought back at Rs 9. Equity share capital is debited Which can absorb the premium paid on a buy-back?Shares that a company has bought back areWithin six months after a buy-back, a company may still make aThe register of bought back shares is kept at the company's