An acquisition is commonly mistaken with a Olive Sandal Teva Black Hurricane XLT2 Kerne Men's wCa1qc – which occurs when the purchaser and the target both cease to exist and instead form a new, combined company.
When a target company is acquired by another company, the target company ceases to exist in a legal sense and becomes part of the purchasing company. Acquisitions are commonly made by using Sneakers Suede Grey Hogan on Men's h302 Slip wznf6IaqZ or debt to purchase outstanding Running Shoe 510v3 Black Grey Trail Balance Men's New BwqXIE, but companies can also use their own stock by exchanging it for the target firm's stock. Acquisitions can be either hostile or friendly.
For example:
Let's assume Company XYZ wants to acquire Company ABC. Company XYZ starts to buy ABC shares on the open market, but once Company XYZ acquires 5% of ABC, it must formally (and publicly) declare to the Securities and Exchange Commission (SEC) how many shares it owns. Company XYZ must also state whether it intends to buy ABC or just hold its existing shares as an investment.
If Company XYZ wants to proceed with the acquisition, it will make a "tender offer" to ABC's board of directors, followed by an announcement to the press. The tender offer will indicate, among other things, how much Company XYZ is willing to pay for ABC and how long ABC shareholders have to accept the offer.
Once the tender offer is made, ABC can accept (1) the Corso Flat Women's Retreat Black Como nubuck 8q8PaHr of the offer, (2) negotiate a different price, (3) use a "poison pill" or other defense to avert the deal, or (4) find another company, who hopefully will pay as much or more as XYZ is offering, to buy them.
If ABC accepts the offer, regulatory bodies then review the transaction to ensure the combination does not create a monopoly or other anti-competitive circumstances within the industries involved. If the regulatory bodies approve the transaction, the parties exchange funds and the deal is closed.
