Which of the following terms describes an offer to purchase some or all shareholders' shares in a corporation, usually at a premium to the market price?
- Tender
- Stock split
- Redemption
- Class action
Answer(s): A
Explanation:
Tender Offer Definition: A tender offer is an offer to purchase a certain number of shares from shareholders, typically at a price above the current market value. This is often part of mergers,
acquisitions, or corporate takeovers.
Stock Split: A stock split increases the number of shares but decreases the price per share without affecting the total value of an investor's holdings.
Redemption: Redemption refers to the repayment of a bond or preferred stock at maturity or at a predetermined date.
Class Action: A class action is a lawsuit filed by a group of people with similar grievances.
Reference:
SEC Rule 14e on tender offers: SEC Tender Offers.
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