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Can a small company buy a big company with stock without borrowing?

Personal Finance & Money Asked by Darby Bond on September 26, 2021

I know a company can buy another company with stock. Doesn’t that mean that even a tiny company can buy a bigger company with its stock as long as the big company will accept?

2 Answers

Yes, if the larger company's owners or board of directors feel that the smaller company's prospects are exceptionally good. For example, the board of Sears voted in favor of an acquisition by Kmart, the acquisition being orchestrated by the largest investor in both companies, a boy-wonder hedge fund manager.

https://www.nbcnews.com/id/wbna6509683

Correct answer by Orange Coast- reinstate Monica on September 26, 2021

A ‘small’ company wouldn’t have enough stock to pay for a ‘large’ company - otherwise it would not be called ‘small’.

Answered by Aganju on September 26, 2021

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