DEFINITION of 'Bon Voyage Bonus'

Cash, securities or other assets paid to an individual or group for ceasing a particular activity. A bon voyage bonus is most often associated with hostile takeovers, with the target company paying the traider for not making further attempts to force a takeover for a specific period of time. It is often considered the payment to a greenmailer.

BREAKING DOWN 'Bon Voyage Bonus'

Paying a bon voyage bonus to a greenmailer is one of several tactics that a target company can employ to fend off a takeover, though it can be very costly. In order to cease a takeover bid, a corporate raider will most likely demand a premium over the current share price. Some companies may include an anti-greenmail provision in their charters, so as to prevent this sort of situation from arising.

RELATED TERMS
  1. Greenmail

    An antitakeover measure that arises when a large block of stock ...
  2. Takeover

    A corporate action where an acquiring company makes a bid for ...
  3. Takeover Bid

    A type of corporate action in which an acquiring company makes ...
  4. Black Knight

    A company that makes a hostile takeover offer for a target company. ...
  5. Voyage Policy

    A financial protection plan that provides coverage for goods ...
  6. "Just Say No" Defense

    A strategy used by corporations to discourage hostile takeovers ...
Related Articles
  1. Investing

    Warding Off Hostile Takeovers

    The purpose of this article is to provide a general overview of hostile corporate takeovers, while highlighting a general course of action against such activity. This article provides basic information ...
  2. Small Business

    What is a Takeover?

    A takeover happens when one company makes a bid to acquire a target company.
  3. Investing

    Mergers And Acquisitions: Understanding Takeovers

    In the dramatic world of M&As, battleground terms meld with bizarre metaphors to form the language of the game.
  4. Investing

    Pinpoint Takeovers First

    Use these seven steps to discover a takeover before the rest of the market catches on.
  5. Investing

    Reverse Takeover

    Learn more about this type of takeover and how companies use it to avoid IPOs.
  6. Investing

    Corporate Takeover Defense: A Shareholder's Perspective

    Find out the strategies corporations use to protect themselves from unwanted acquisitions.
  7. Investing

    Trademarks Of A Takeover Target

    These tips can lead you to little companies with big prospects.
  8. Small Business

    How To Profit From Mergers And Acquisitions Through Arbitrage

    Making a windfall from a stock that attracts a takeover bid is an alluring proposition. But be warned – benefiting from m&a is easier said than done.
  9. Investing

    More Bonuses And Fewer Raises Affect Workers

    Companies are increasingly replacing salary increases with bonuses, much to the detriment of employees.
  10. Small Business

    3 Reasons Businesses Give Bonuses to Poor Performers

    Learn more how bonuses paid to poorly-performing employees affect a company and why many businesses are still paying out financial rewards to such workers.
RELATED FAQS
  1. Under what circumstances might a company decide to do a hostile takeover?

    Learn about why companies use a hostile takeover to gain control of another company, and understand the different methods ... Read Answer >>
  2. What happens to the shares of a company that has been the object of a hostile takeover?

    Learn about the effect on the share price of companies that are targets of hostile takeovers, which are tactics used by famed ... Read Answer >>
  3. How can a company buy back shares to fend off a hostile takeover?

    Learn about why a business might use a stock buyback to thwart a hostile takeover attempt by reducing its total assets and ... Read Answer >>
  4. What is the difference between an acquisition and a takeover?

    There is no tangible difference between an acquisition and a takeover; both words can be used interchangeably - the only ... Read Answer >>
  5. What is the difference between a hostile takeover and a friendly takeover?

    Learn about the difference between a hostile takeover and a friendly takeover, and understand how proxy fights and tender ... Read Answer >>
  6. What's the difference between a merger and a hostile takeover?

    Understand the difference between a merger and a hostile takeover, including the different ways one company can acquire another, ... Read Answer >>
Hot Definitions
  1. Magna Cum Laude

    An academic level of distinction used by educational institutions to signify an academic degree which was received "with ...
  2. Cover Letter

    A written document submitted with a job application explaining the applicant's credentials and interest in the open position. ...
  3. 403(b) Plan

    A retirement plan for certain employees of public schools, tax-exempt organizations and certain ministers. Generally, retirement ...
  4. Master Of Business Administration - MBA

    A graduate degree achieved at a university or college that provides theoretical and practical training to help graduates ...
  5. Liquidity Event

    An event that allows initial investors in a company to cash out some or all of their ownership shares and is considered an ...
  6. Job Market

    A market in which employers search for employees and employees search for jobs. The job market is not a physical place as ...
Trading Center