B) Say what classes of shares are usually issued by companies and what rights they give their holders

B) Mergers and Acquisitions

Profitable growth constitutes one of... prime objectives of most of the business firms. It can be achieved "internally", either through... process of introducing or developing... new products, as well as by expanding the capacity of existing products... firm is engaged in. Alternatively, growth process can be facilitated "externally", by acquisitions of... existing business firms. This acquisition is technically referred to as mergers, acquisitions, amalgamations, takeovers, absorptions, consolidations, etc. Although... legal procedures involved in these terms are different, these terms are often used interchangeably. It is... finance manager's job to say "how large an enterprise should be, how fast it should grow, and how it should grow".

If... enterprise grows "internally" it can retain control with itself during expansion and it will be free to choose how to grow. However,... internal expansion usually involves... longer implementation period as well as different problems connected with raising... necessary funds. Mergers or acquisitions, in most cases, help to avoid... financial problems and expedite... pace of growth, by saving the time otherwise required in building up new facilities from scratch in the case of internal expansion programme.

Mergers are typically classified into... horizontal mergers (when two or more corporate firms dealing in... similar lines of activity combine together) and vertical mergers, extending to... suppliers of raw materials or distributors. The finance manager's job is to evaluate such merger decisions.

Words you may need:

takeover n слияние компаний

expedite v ускорять

pace n темп(ы)

from scratch с нуля

Ex. 9. a) Supply the prepositions where necessary.

Financial Capital

Financial capital includes the liquid assets of a company as opposed... physical assets. Companies can have a variety of types of capital. The principal distribution is... share capital and loan or debenture capital.

The most usual classes of share... which the capital of a company can be divided are preference, ordinary, and deferred shares.

Preference shares have a fixed rate... dividend. However large the profits of a company might be, the holders of preference shares are not entitled... any additional dividends over and above the rate of dividend agreed when the shares are first issued. The holders of preference shares do not usually have any voting rights. This means that they cannot vote... the general meetings of the company. But they do have an advantage... the holders of all other types of shares in that the dividends due... preference shares must be paid before any dividend is paid... the holders of ordinary or deferred shares.

Ordinary shares entitle their owners a vote at companies' general meetings. They also have a right to elect company directors, and to receive a proportion of distributed profits... the form of a dividend.

Issuance of shares is a source... capital for companies. If a company wishes to raise more money... expansion it can issue new shares. These are frequently offered... existing share holders... less than their market price: this is known as a rights issue.

Companies may also turn part of their profit... capital by issuing new shares to shareholders instead... paying dividends. This is known as a bonus issue or scrip issue or capitalisation issue. The source of equity is the securities market.

Loan capital is a long-term debt. Companies can raise this type of capital... clearing banks, merchant banks and even pension funds.

The composition of a company's capital is called capital structure.

Words you may need:

debenture capital заемный капитал

preference shares привилегированные акции

ordinary shares обычные акции

deferred shares отсроченные акции

voting right право голоса

rights issue выпуск льготных акций, предлагаемых акционерам компании

bonus/scrip/capitalisation issue бонусная эмиссия, выпуск льготных акций (или бесплатных акций)

Дата добавления: 2014-11-29