Page 270 - SBR Integrated Workbook STUDENT S18-J19
P. 270
Chapter 18
Example 5
Identifying the acquirer
Tangerine issues shares to the shareholders of Clementine in exchange for all
of the outstanding shares of Clementine. The original shareholders of
Tangerine will have 52% of the voting shares of the combined entity. The
Board of Directors of the combined entity will consist of five directors from
Clementine and three from Tangerine. A two-thirds vote of the shareholders of
the combined entity is required for removal of Board members. The senior
management team of the combined entity will consist of one member from
Tangerine and two members from Clementine.
Discuss whether Tangerine or Clementine is the acquirer in the business
combination.
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