Managers and shareholders often clash over how to use a company's extra cash. When firms have more cash than good investment options, it can lead to problems. Debt can help reduce these issues by giving managers less freedom to waste cash. Taking on debt can also be a way to pay shareholders instead of giving them cash directly. Programs that try to diversify a company's activities can be risky and often lead to losses. It's more common for companies to do well before being taken over. The reasons for takeovers are similar across different industries like broadcasting, tobacco, and oil.