Go Shop Period

AAA

DEFINITION of 'Go Shop Period '

A provision that allows a public company that is being sold to seek out competing offers even after it has already received a firm purchase offer. The original offer then functions as a floor for possible better offers. The duration of a go-shop period is usually about one to two months. Go-shop agreements may give the initial bidder the opportunity to match any better offer the company receives, and may pay the initial bidder a termination fee if target companies are purchased by another firm.




INVESTOPEDIA EXPLAINS 'Go Shop Period '

The go-shop period is meant to help ensure that the board of directors fulfills its fiduciary duty to make sure shareholders get the best deal possible from the transaction. Critics say that go-shop periods rarely result in additional offers, and that they don't give other potential buyers enough time to perform due diligence on the target company.



RELATED TERMS
  1. Breakup Fee

    A common fee used in takeover agreements if the seller backs ...
  2. Fiduciary Abuse

    Describes a situation in which an individual who is legally appointed ...
  3. Fiduciary Negligence

    A professional malpractice in which a person fails to honor his ...
  4. Fiduciary

    1. A person legally appointed and authorized to hold assets in ...
  5. Target Firm

    A company which is the subject of a merger or acquisition attempt. ...
  6. Separation Of Powers

    An organizational structure in which responsibilities, authorities, ...
Related Articles
  1. Fundamental Analysis

    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.
  2. Investing Basics

    The Merger - What To Do When Companies Converge

    Learn how to invest in companies before, during and after they join together.
  3. Bonds & Fixed Income

    Trademarks Of A Takeover Target

    These tips can lead you to little companies with big prospects.
  4. Fundamental Analysis

    Why would I need to know how many outstanding shares the shareholders have?

    Find out why shareholders should know how many outstanding shares have been issued by a corporation, and learn what happens when more shares are issued.
  5. Fundamental Analysis

    How do you use Microsoft Excel to calculate liquidity ratios?

    Learn how to calculate the most common liquidity ratios in Microsoft Excel by inputting financial figures from a company's balance sheet.
  6. Economics

    America's Most Notorious Corporate Criminals

    Learn about the crimes and punishments of some of the most infamous convicted white-collar crooks.
  7. Investing Basics

    What is revenue cycle management?

    Learn more about revenue cycle management and why the healthcare industry in particular has adopted this payment process philosophy.
  8. Fundamental Analysis

    Is it important for a company always to have a high liquidity ratio?

    Understand the significance of the liquidity ratio and how it is used in conjunction with other measures to arrive at an overall evaluation of a company.
  9. Fundamental Analysis

    How can a company quickly increase its liquidity ratio?

    Discover what high and low values in the liquidity ratio mean and what steps companies can take to improve liquidity ratios quickly.
  10. Fundamental Analysis

    To what extent should you take a company's liquidity ratio into account before investing in it?

    Find out how important it is for an investor to know a company's liquidity ratio before deciding to invest, and why relying on one ratio can be dangerous.

You May Also Like

Hot Definitions
  1. Treasury Bond - T-Bond

    A marketable, fixed-interest U.S. government debt security with a maturity of more than 10 years. Treasury bonds make interest ...
  2. Weight Of Ice, Snow Or Sleet Insurance

    Financial protection against damage caused to property by winter weather specifically, damage caused if a roof caves in because ...
  3. Weather Insurance

    A type of protection against a financial loss that may be incurred because of rain, snow, storms, wind, fog, undesirable ...
  4. Portfolio Turnover

    A measure of how frequently assets within a fund are bought and sold by the managers. Portfolio turnover is calculated by ...
  5. Commercial Paper

    An unsecured, short-term debt instrument issued by a corporation, typically for the financing of accounts receivable, inventories ...
  6. Federal Funds Rate

    The interest rate at which a depository institution lends funds maintained at the Federal Reserve to another depository institution ...
Trading Center