Which of the Following Statements Is FALSE

question 15

Multiple Choice

Which of the following statements is FALSE?

• A)In practice,most acquirers pay a substantial acquisition premium,which is the percentage difference between the acquisition price and the premerger price of the target firm.
• B)When a bid is announced,the target shareholders enjoy a gain of 15% on average in their stock price.
• C)In most U.S.states,the law requires that when existing shareholders of a target firm are forced to sell their shares,they receive the market price for their shares.In most cases,this concept is interpreted as the value inclusive of any value that arises because of the merger itself.
• D)A bidder is unlikely to acquire a target company for less than its current market value.

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Definitions:

Subclavian Arteries

Major arteries on either side of the body that supply blood to the arms, brain, and thorax.

Vertebral Arteries

Arteries that supply blood to the upper spinal cord, brainstem, and the posterior portion of the brain.

Thyrocervical Arteries

A group of arteries that arise from the thyrocervical trunk and supply blood to the thyroid gland and surrounding areas.

Common Carotid

A major artery that supplies blood to the head and neck.