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Foundations Of Financial Management
Found in: Page 648
Foundations Of Financial Management

Foundations Of Financial Management

Book edition 16th
Author(s) Stanley B. Block, Geoffrey A. Hirt, Bartley Danielsen
Pages 768 pages
ISBN 9781259277160

Short Answer

Why do management and stockholders often have divergent viewpoints about the desirability of a takeover?

Management may have the option to retain the ownership or same job level after the takeover, whereas stockholders may have an option to increase the current shareholdings.

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Step by Step Solution

Explanation on Takeover

A takeover is a financial activity in which one business entity purchases another entity.

Opinion of Management and Stockholder

Management refers to individuals who manage the business. It includes the CEO, CFO, Directors, Chairman, etc. The motive of the takeover of the management may be focused on retaining current job and control. Shareholders invest an amount in business and are focused on increasing the existing wealth after the takeover.

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