The drag and drop right can be enabled and set in the terms of the share class offer or in the M&A agreement.
The drag right eliminates the current minority shareholders by selling 100% of the company’s securities to a potential buyer.
Sharing rights differ from drag and drop rights in that sharing rights offer minority shareholders the opportunity to sell, but do not impose obligations.
Acquisition premium is the difference between the estimated real value of a company and the actual price paid for its acquisition in an M&A transaction.
Performance Based Management (ABM) is a means of analyzing a company’s profitability by looking at every aspect of its business to determine its strengths and weaknesses.
Back integration is when a company expands its role to perform tasks that were previously performed by enterprises located higher up in the supply chain.
Share capital is the number of ordinary and preferred shares that the company has the right to issue and which are accounted for on the balance sheet as part of share capital.
As a result of the spin-off, the parent company sells a portion of its shares in its subsidiary to the public through an initial public offering (IPO), effectively turning the subsidiary into a stand-alone company.