This article from the WSJ reports on a proposal by Fox News to acquire Time Warner. 'The deal initially valued Time Warner at $85 a share, according to people familiar with the matter, a premium of more than 20% to Time Warner's stock price at the time. Time Warner said that the offer isn't in its best interests and that its strategic plan "is superior to any proposal that Twenty-First Century Fox is in a position to offer."'
Here are some questions.
- Who determines the value of Time Warner's strategic plan?
- To whom does "its" refer in the quote?
- Who decided that spokespeople for Time Warner would announce that the offer is not in its best interests?
- What information does the decider possess?
- What incentives do they face?
- Are the interests of the decider aligned with the interests of the shareholders?
P.S. This article from USA Today reports that Fox withdrew its bid. Based on the reaction of the stock prices, who did investors think the merger would help, Fox or Time Warner? Who would it hurt?
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