Studies of acquisitions and mergers suggest that shareholders of the:
A) Bidding firm benefit the most from a merger.
B) Bidding firm average at least a 5% excess return on a merger.
C) Target firm have the most to gain from a merger.
D) Bidding firm benefit in equal proportion to the shareholders of the target firm.
E) Target firm benefit more if a proxy contest develops.

Question

Quizplus · Accepted Answer

Studies generally find that shareholders of the target firm tend to gain the most from mergers and acquisitions, often receiving a premium over the market price for their shares.

Studies of Acquisitions and Mergers Suggest That Shareholders of The