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NextQ17

Assertion (A): Mergers and Acquisitions is a potential strategy for ensuring the accelerated growth of business. Reason (R): Growing through Mergers and Acquisitions usually turns out to be less expensive as compared with internal expansion, particularly when the replacement cost of asset is higher than the market value of the targeted assets.

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Question 16

Nipro Electronics was the leading player in the electronics industry for the last fifteen years. A few years back, Mobe Electronics, a smaller company entered the market. Nipro Electronics started losing its market share to Mobe Electronics due to its innovative products. To maintain or develop a competitive edge, Nipro Electronics decided to acquire Mobe Electronics under friendly terms but that failed. Now it decided to buy majority shares of Mobe Electronics and hence initiated the acquisition. From the following, identify the type of acquisition which Nipro Electronics adopted after failing on friendly terms:

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