When Whelan presents Zenith’s proposed takeover to the board of directors the following day,
one of the directors made the following statements:
Which is one the most accurate?
Although I am certainly in favor of this takeover, I think we would achieve the greatest
value from the acquisition if we offered more stock and less cash.
If Zenith does not realize the potential synergies of this acquisition in the next five years,
I suggest a “spin-off” as a means to recover some of the money lost in this venture.
A positive initial market reaction will confirm that we did not overpay for Zenith.
Why is it 3 and not 2?