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Business LibreTexts

18: 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:

    1. How a corporation can expand by purchasing assets of another company without purchasing stock or otherwise merging with the company whose assets are purchased
    2. The benefits of expanding through a purchase of assets rather than stock
    3. Both the benefits and potential detriments of merging with another company
    4. How a merger differs from a stock purchase or a consolidation
    5. Takeovers and tender offers
    6. Appraisal rights
    7. Foreign corporations and the requirements of the US Constitution
    8. The taxation of foreign corporations
    9. 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.

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