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Company A are approached by a wealthy and internationally famous investor shortly before the launch date of their IPO. He tells them that the company do not need to incur all of the cost and risk of an IPO, as he will give them S55 million for 65% equity in the company.
Which of the following statements are also true of the offer? Select ALL that apply.
Suggested Answer: C
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33 comments · newest first
RO
Rodrigo
11 months ago
Totally agree, a long-term commitment is likely what he wants!
VE
Venita
11 months ago
The majority stakeholder might have to sell shares eventually, true.
AN
Angella
11 months ago
Wait, can they really give up 65% equity? That seems risky.
TW
Twanna
12 months ago
I think the investor will want to manage the company for sure.
BO
Bobbye
12 months ago
This offer is definitely from an angel investor!
AL
Alita
1 year ago
I'm a bit confused about option D. Wouldn't a wealthy investor typically want a quick return rather than a long-term commitment?
TR
Tran
1 year ago
I feel like option C makes sense too; if he's investing that much, he might want a say in how things are run.
GA
Garry
1 year ago
I think option B could be true because if he takes 65%, he might push for more control later on.
JO
Jospeh
1 year ago
I remember discussing angel investors in class, but I'm not sure if this investor qualifies since he's so famous and wealthy.
ER
Ernest
1 year ago
This is a tricky one. I'll need to draw on my knowledge of investment strategies and company structures to figure out the right answers.
JO
Jordan
1 year ago
Okay, I think I've got a handle on this. Let me jot down my thoughts and then select the correct options.
MA
Malinda
1 year ago
Hmm, I'm a bit unsure about this one. The information provided is quite specific, so I'll need to think through the implications of each statement carefully.
JU
Julian
1 year ago
This seems like a pretty straightforward question. I'll need to carefully analyze the details of the offer to determine which statements are true.
RE
Rex
1 year ago
This investor sounds like they're trying to pull a fast one on the company. $55 million for 65% of the company? They must have a crystal ball to know the company's future value!
PO
Polly
1 year ago
I bet the investor is already planning their exit strategy. They'll likely want to sell their shares in the company at some point for a nice profit.
AR
Aretha
1 year ago
C) The investor will probably want to manage the company
MI
Milly
1 year ago
B) The offer may ultimately require the majority stakeholder to sell his shares in the company
BR
Brittani
1 year ago
A) This offer is from an angel investor
GL
Glenna
1 year ago
The investor will definitely want to have a say in the management of the company. This is a significant ownership stake, so they'll probably want to be involved in major decisions.
MA
Martina
1 year ago
C) The investor will probably want to manage the company
TA
Talia
1 year ago
A) This offer is from an angel investor
DE
Delfina
1 year ago
Hmm, I'm not sure if the investor is an angel investor. The amount of investment is quite high for an angel investor. I'd say this is more likely a venture capitalist or a private equity firm.
OT
Otis
1 year ago
C) The investor will probably want to manage the company
KR
Kristofer
1 year ago
B) The offer may ultimately require the majority stakeholder to sell his shares in the company
MI
Mi
1 year ago
A) This offer is from an angel investor
CA
Catherin
2 years ago
This seems like a great opportunity for the company to avoid the hassle and risk of an IPO. The investor's offer of $55 million for a 65% stake is quite generous.
FL
Fletcher
1 year ago
I think the majority stakeholder might have to give up control if they accept the offer.
GL
Glenn
1 year ago
It could be a good way to get the company off the ground without going through the IPO process.
JE
Jerilyn
1 year ago
I wonder if the investor will want to have a say in how the company is run.
RU
Rueben
1 year ago
That's a lot of money for a majority stake in the company.
FE
Felix
2 years ago
C) The investor will probably want to manage the company
LI
Lili
2 years ago
B) The offer may ultimately require the majority stakeholder to sell his shares in the company
FE
Felix
2 years ago
A) This offer is from an angel investor