Hostile Takeover

A hostile takeover is a type of corporate acquisition or merger which is carried out against the wishes of the board (and usually management) of the target company.

A hostile takeover is a type of corporate acquisition or merger which is carried out against the wishes of the board (and usually management) of the target company. In a hostile takeover the target company's board of directors rejects the offer, but the bidder continues to pursue the acquisition.

Most acquisitions and mergers occur in the business world by mutual agreement - both sides agree that all of the shareholders’ interests are served best by the transaction. In those instances, both sides have a chance to evaluate the costs and benefits, assets and liabilities, and proceed with full knowledge of the risks and returns.

However, in a hostile takeover, because the management and board of the target company resist the acquisition, they usually do not share any information that is not already publicly available. As a result, the acquiring firm takes a risk and may unwittingly acquire debts or serious technical problems.

In addition, the loss of key managers and leadership within the company may cause a shakeup within the target company which may disrupt its operations and threaten its viability.

Ingram Associates have assisted companies to fight off hostile takeovers by obtaining previously undisclosed detrimental knowledge, in respect of either directors, company results or over stated assets, which knowledge has then been disclosed to the market.

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