BLS 112 Chapter Notes - Chapter 41: Tender Offer, Legal Death, Takeover

• School: Binghamton University
• Department: Business Law and Society
• Course: BLS 112
• Professor: S U N Y Ulster

Document Summary

Chapter 41: mergers and takeovers: merger, consolidation, & share exchange. Inherits legal rights & obligation of absorbed corporation. Consolidation: 2 or more corporations combine so each ceases to exist, creates new corporation: consolidated corporation: completely new entity created, corporation a + corporation b corporation c. Short-form merger: (parent-subsidiary merger) accomplished without approval of shareholders of either corporation: used only when parent owns at least 90% outstanding shares of subsidiary. Shareholder approval: bod makes decisions on ordinary matters, both bod & shareholders make decisions on extraordinary matters, mergers & other combinations need shareholder approval, bod may seek shareholder approval even when not legally required. Fair value = value on day prior to vote: only recourse available. Acquiring corporation does not need shareholder approval for purchase. Selling corporation needs approval from bod & shareholders. It is a substantial change in business position. Government restrictions: both us department of justice & ftc have guidelines.