I'm no expert but everything about this fiasco just reeks.....
this is from wikipedia.... Takeover of a Company
https://en.wikipedia.org/wiki/Takeover
"An acquiring company can also engage in a
proxy fight, whereby it tries to persuade enough shareholders, usually a
simple majority, to replace the management with a new one which will approve the takeover.
Another method involves quietly purchasing enough stock on the open market, known as a "creeping tender offer", to effect a change in management. In all of these ways, management resists the acquisition, but it is carried out anyway."
..............
................. For example, it is fairly easy for a top executive to reduce the price of his/her company's stock – due to information asymmetry. The executive can accelerate accounting of expected expenses, delay accounting of expected revenue, engage in off-balance-sheet transactions to make the company's profitability appear temporarily poorer, or simply promote and report severely conservative (e.g. pessimistic) estimates of future earnings. Such seemingly adverse earnings news will be likely to (at least temporarily) reduce share price. ,,,,,,,,,, (This is again due to information asymmetries since it is more common for top executives to do everything they can to
window dress their company's earnings forecasts).
There are typically very few legal risks to being 'too conservative' in one's accounting and earnings estimates.
A reduced share price makes a company an easier takeover target. When the company gets bought out (or taken private) – at a dramatically lower price –
the takeover artist gains a windfall from the former top executive's actions to surreptitiously reduce share price. This can represent tens of billions of dollars (questionably) transferred from previous shareholders to the takeover artist. The former top executive is then rewarded with a golden handshake for presiding over the
fire sale that can sometimes be in the hundreds of millions of dollars for one or two years of work. (This is nevertheless an excellent bargain for the takeover artist, who will tend to benefit from developing a reputation of being very generous to parting top executives). This is just one example of some of the
principal–agent/
perverse incentive issues involved with takeovers.
So, is there a consortium with a simple majority behind this? Is there an executive of the company that fits the description in bold italics above ?
We've been punkd .....
"This can represent tens of billions of dollars (questionably) transferred from previous shareholders to the takeover artist."
Time will reveal the truth about MBN
Sentiment [SICK AND DISMAYED]
Position [COMATOSE , FETAL]
