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← Series 79: M&A, Tender Offers & Restructuring
Series 79 practice questioneasyGoing-Private Transactions

SEC Rule 13e-3 applies to which type of transaction?

  1. AGoing-private transactions where the issuer or its affiliate causes a class of equity securities to be delisted or the number of holders to fall below 300✓ Correct answer
  2. BAny public offering of securities
  3. CAll mergers involving publicly traded companies
  4. DOnly transactions involving foreign private issuers
Explanation

Why A — Going-private transactions where the issuer or its affiliate causes a class of equity securities to be delisted or the number of holders to fall below 300

Rule 13e-3 applies to going-private transactions involving an issuer or an affiliate of the issuer that have the effect of causing a class of equity securities to become eligible for deregistration under the Exchange Act. This includes transactions that cause the company to be delisted from a national securities exchange or reduce the number of record holders below 300. The rule requires enhanced disclosure, including a statement of the purpose and fairness of the transaction.

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