3 ms·
> As many people point out, the CEO has some level of fiduciary duty to investors. If you refuse an offer with a 40% or so premium, you are going to be facing d
by earnesti 2y ago
> As many people point out, the CEO has some level of fiduciary duty to investors. If you refuse an offer with a 40% or so premium, you are going to be facing down lawsuits.
I think a simple way to avoid this is to ask for a all-cash offer. Naturally it will be either non-existant or much smaller value. If the offer is still good, it is not a problem to accept it.
The problem here was that the sellers were accepting stock as a payment, which was garbage.
- kelnos 2y agoI don't think that would tell them much. All-cash requires that the acquiring company either have that cash on hand, go into (further?) debt, or sell new shares to the public to raise the money. Legitimate M&A deals that are in part or even entirely in stock are very common. A refusal to accept anything but an all-cash deal would certainly weed out a fraudster like this one, but it would also eliminate a host of good deals, too.