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Business LibreTexts

25: Corporate Expansion, State and Federal Regulation of Foreign Corporations, and Corporate Dissolution

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    Learning Objectives

    After reading this chapter, you should understand the following:

    • How a corporation can expand by purchasing assets of another company without purchasing stock or otherwise merging with the company whose assets are purchased
    • The benefits of expanding through a purchase of assets rather than stock
    • Both the benefits and potential detriments of merging with another company
    • How a merger differs from a stock purchase or a consolidation
    • Takeovers and tender offers
    • Appraisal rights
    • Foreign corporations and the requirements of the US Constitution
    • The taxation of foreign corporations
    • Corporate dissolution and its various types

    This chapter begins with a discussion of the various ways a corporation can expand. We briefly consider successor liability—whether a successor corporation, such as a corporation that purchases all of the assets of another corporation, is liable for debts, lawsuits, and other liabilities of the purchased corporation. We then turn to appraisal rights, which are a shareholder’s right to dissent from a corporate expansion. Next, we look at several aspects, such as jurisdiction and taxation, of foreign corporations—corporations that are incorporated in a state that is different from the one in which they do business. We conclude the chapter with dissolution of the corporation.