In Practice: How Do You Buy Back Stock? The process of repurchasing equity will depend largely on whether the firm intends to repurchase stock in the open market at the prevailing market price or to make a more formal tender offer for its shares. There are three widely used approaches to buying back equity: · Repurchase Tender Offers: In a repurchase tender offer, a firm specifies a price at which it will buy back shares, the number of shares it intends to repurchase, and the period of time for which it will keep the offer open and invites stockholders to submit their shares for the repurchase. In many cases, firms retain the flexibility to withdraw the offer if an insufficient number of shares are submitted or to extend the offer beyond the originally specified time period. This approach is used primarily for large equity repurchases. · Open Market Repurchases: In the case of open market repurchases, firms buy shares in the market at the prevailing market price. Although firms do not have to disclose publicly their intent to buy back shares in the market, they do have to comply with SEC requirements to prevent price manipulation or insider trading. Finally, open market purchases can be spread out over much longer time periods than tender offers and are more widely used for smaller repurchases. In terms of flexibility, an open market repurchase affords the firm much more freedom in deciding when to buy back shares and how many shares to repurchase. · Privately Negotiated Repurchases: In privately negotiated repurchases, firms buy back shares from a large stockholder in the company at a negotiated price. This method is not as widely used as the first two and may be employed by managers or owners as a way of consolidating control and eliminating a troublesome stockholder.
This question was answered on: Oct 15, 2019Buy this answer for only: $15
This attachment is locked
Pay using PayPal (No PayPal account Required) or your credit card . All your purchases are securely protected by .
About this QuestionSTATUS
Oct 15, 2019EXPERT
YES, THIS IS LEGAL
We have top-notch tutors who can do your essay/homework for you at a reasonable cost and then you can simply use that essay as a template to build your own arguments.
You can also use these solutions:
- As a reference for in-depth understanding of the subject.
- As a source of ideas / reasoning for your own research (if properly referenced)
- For editing and paraphrasing (check your institution's definition of plagiarism and recommended paraphrase).
NEW ASSIGNMENT HELP?
Order New Solution. Quick Turnaround
Click on the button below in order to Order for a New, Original and High-Quality Essay Solutions. New orders are original solutions and precise to your writing instruction requirements. Place a New Order using the button below.
WE GUARANTEE, THAT YOUR PAPER WILL BE WRITTEN FROM SCRATCH AND WITHIN A DEADLINE.