[Battle for the Board] the Board of Directors of InfoHub

question 40

Multiple Choice

[Battle for the Board] The Board of Directors of InfoHub, an internet service provider, contains 9 directors. Two of the directors, Jude and Rostan, decide they want to replace several of the directors with individuals who support their position and then take over the Board and control the company. Jude thinks it's a long shot, but Rostan tells him they could do it because Rostan has gradually been accumulating shares and they can get a majority of proxies on their side. Jude says the proxies are not important, because it's the shareholders that vote for the members of the board but it is difficult for them to find the names of shareholders. Rostan tells him not to worry, because he will get the shareholder list and focus only a few key shareholders, then get their proxies on his side before the next shareholder meeting.
-What type of takeover is contemplated in this situation?

• A) Beachhead offer
• B) Exchange tender offer.
• C) Cash tender offer.
• D) Beachhead acquisition.
• E) Takeover acquisition.

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Definitions:

Terms Of Trade

The rate at which units of one product can be exchanged for units of another product; the price of a good or service; the amount of one good or service that must be given up to obtain 1 unit of another good or service.

Balance Of Payments

A summary of all the financial transactions that take place between the individuals, firms, and governmental units of one nation and those of all other nations during a year.

Floating Exchange Rates

Currency values that fluctuate in response to the foreign exchange market without intervention by government or central banks.

Central Banks

The principal monetary authority responsible for overseeing the monetary system, issuing currency, and implementing economic policies of a country or monetary union.