What Is Meant by a Change in Corporate Control? List and Describe the Various Ways in Which a Change of Corporate Control May Occur

Corporate control has to do with a change in direction for a company. This change in direction for a business happens a couple different ways. One form of corporate control that forces change happens when two or more businesses merge together to form one company. This merger or acquisition forces changes at all levels of the organization. The monitoring, supervision, and direction of a corporation or other business organization can change overnight once company merges with another company. Another change in corporate control is with the consolidation of voting power for small group of investors. This change may occur in small groups like: leverage buyouts (LBO) and management buyouts (MBO). By transferring ownership of business unit control from corporation to small group changes management structure in the way they monitoring and supervise the organization.

There are various ways in which a change of corporate control may occur within any business. When a company is being faced with an acquisition situation, what happens to the company's assets is a great concern. Another concern about corporate control of assets is purchasing new assets and how this will be handled with the merger between two companies. The consolidation of voting power changes how the company makes business decisions and how the organization is handled and communicates changes so the business can continue to operate successfully. When a company goes through what is called a spin-off, it is creating a new subsidiary or division in hopes of creating positive change for shareholders. The change in corporate control would transfer to the newly formed organization in order to allow for growth and effectively compete in the market place.