What are the predator shareholders, Financial Management

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What are the Predator shareholders

Predator company's shareholders mayn't approve the bid for various reasons.

Reduction in EPS

If consideration is in shares, number of shares issued will increase, hence reducing EPS.

Risky

Target company may be in a risky industry.

Control

There would be a change in effective control if more shares issued.

Gearing

If target company is highly geared, predator company's gearing will change, and there will more financial risk.

 


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