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Series 79: M&A, Tender Offers & Restructuring
Series 79 practice questionmediumMerger Consideration

Which form of merger consideration ensures that the target shareholders receive a set dollar amount per share at closing, regardless of the acquirer’s share price?

  1. AFixed-value
  2. BFloating exchange ratio✓ Correct answer
  3. CContingent value right (CVR)
  4. DFixed-share
Explanation

Why BFloating exchange ratio

A floating exchange ratio changes the number of acquirer shares so target holders receive a set dollar value. A fixed-share exchange ratio delivers a fixed number of shares whose value fluctuates.

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