Friendly Takeovers - definition... A friendly t
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Posted On: 04/08/2020 11:57:30 AM
Friendly Takeovers - definition...
A friendly takeover occurs when one corporation acquires another with both boards of directors approving the transaction. Most takeovers are friendly, but hostile takeovers and activist campaigns have become more popular lately with the risk of activist hedge funds.
In a friendly takeover, both shareholders and management are in agreement on both sides of the deal. In a merger, one company, known as the surviving company, acquires the shares and assets of another with the approval of said company's directors and shareholders. The other ceases to exist as an independent legal entity. Shareholders in the disappearing company are given shares in the surviving company.
A friendly takeover occurs when one corporation acquires another with both boards of directors approving the transaction. Most takeovers are friendly, but hostile takeovers and activist campaigns have become more popular lately with the risk of activist hedge funds.
In a friendly takeover, both shareholders and management are in agreement on both sides of the deal. In a merger, one company, known as the surviving company, acquires the shares and assets of another with the approval of said company's directors and shareholders. The other ceases to exist as an independent legal entity. Shareholders in the disappearing company are given shares in the surviving company.
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