Asked by
Sourav Bansal
on Dec 08, 2024Verified
All else equal, the cost of an acquisition will likely be higher if the acquirer uses its own common stock rather than cash to complete the purchase.
Acquisition Cost
is the total cost incurred to acquire an asset, investment, or property, which includes the purchase price and all associated expenses.
Common Stock
A type of security that represents ownership in a corporation, giving holders voting rights and a share in the company's profits via dividends.
Cash Purchase
A transaction method in which goods or services are paid for in full with cash at the time of purchase.
- Explore the financial mechanisms (cash or stock) employed in the process of mergers and acquisitions, and their significance on the worth of the firms engaged.
Verified Answer
BK
Learning Objectives
- Explore the financial mechanisms (cash or stock) employed in the process of mergers and acquisitions, and their significance on the worth of the firms engaged.