1.The owners of Brownfield Machinery, brothers George and Robb, now in their late 50s, have decided to sell the business. No one else in the family is interested in taking over the business. Brownfield machinery has 11 employees and sales of $2.5 million in 2012.George and Robb are considering an offer from Wilcox Co. Wilcox believes the bulk of Brownfield s value is in its client list. Much of the rest of the assets — including its employees — would most likely be jettisoned after a sale and the proceeds used to pay off the huge debt Wilcox will incur to purchase Brownfield. If George and Robb accept this offer, it could best be described as:

Question

Question 1 options:

a.a bust-up LBO

b.a build-up LBO

c.an IPO

d.sale to employees

2.The owners of Brownfield Machinery, brothers George and Robb, now in their late 50s, have decided to sell the business. No one else in the family is interested in taking over the business. Brownfield machinery has 11 employees and sales of $2.5 million in 2012.George and Robb take pause when they realize Wilcox would break up their business. "These are our guys, our family, and we want them to keep on working". Eight of their employees step up and suggest they became members of a cooperative that will buy the business. The brothers will sell their stock to the co-op in several installments. The co-op will take out loans, which will be personally guaranteed by the sellers. The loans will be paid off out of company profits over ten years. If George and Robb accept this offer, it would best be described as:
Question 2 options:

a.a sale to employees

b.a sale to strategic buyers

c.an IPO

d.distribution of the cash flows

3.Sushi foods, is being acquired by Fusion Foods, a larger company. This acquisition is part of a merger whereby Fusian Foods is also buying three other small Asian food brands in order to create a larger enterprise. Fusion is financing these acquistions with debt. Sometime in the future Fusion Foods hopes to sell the integrated business.
Question 3 options:

a.an IPO

b.management buyout

c.build-up LBO

d.bust-up LBO

4.Heritage Partners, as described in the text, works with family owned businesses to structure deals in which the older generation can exit the business and receive money to retire, while the younger generation wants to retains some ownership in the business and provides managerial leadership. Heritage Partners offers which type of harvesting?
Question 4 options:

a.sale to employees

b.private placement

c.IPOs

d.management buyout