An attempt to gain control of a firm by soliciting a sufficient number of shareholder votes to replace the current board of directors is called a:
A) Tender offer.
B) Proxy contest.
C) Going-private transaction.
D) Leveraged buyout.
E) Consolidation.

Question

Quizplus · Accepted Answer

A proxy contest is a strategy used by shareholders and outside parties attempting to gain control of a company by convincing other shareholders to vote in a way that is contrary to the current management's wishes, often to replace the board of directors.

An Attempt to Gain Control of a Firm by Soliciting