Killer Bees

AAA

DEFINITION of 'Killer Bees'

An individual or firm that helps a company fend off a takeover attempt. A killer bee uses defensive strategies to keep an attempted hostile takeover from occurring. Companies use a variety of anti-takeover measures, sometimes referred to as shark repellents, to discourage unfriendly takeover attempts from happening. Once an unfriendly takeover attempt has been initiated, the company can use other anti-takeover measures to deter or prevent the takeover.


The use of killer bees is one anti-takeover measure that a company can employ. Other tactics include the white knight – a more friendly acquiring company willing to enter the bidding war; the standstill agreement – a negotiated agreement that limits the takeover company's holding in the target company; the Pacman defense – the target company makes a takeover bid for the stock of the bidding company; and litigation – to delay a takeover attempt.

INVESTOPEDIA EXPLAINS 'Killer Bees'

The merger and acquisition boom of the late 1980s forced companies to develop strategies to thwart would-be takeovers. Killer bees, named for the insect that aggressively swarms and overpowers its victims with hundreds of stings, act aggressively on behalf of a firm that is under the threat of an unfriendly or hostile takeover. The killer bee may employ tactics such as making the target company less attractive or more difficult to acquire.

RELATED TERMS
  1. Lobster Trap

    A strategy used by a target firm to prevent a hostile takeover. ...
  2. Sandbag

    A tactic used to hide or limit expectations of a company's or ...
  3. Pac-Man

    A high-risk hostile takeover defense in which the target firm ...
  4. Hostile Takeover

    The acquisition of one company (called the target company) by ...
  5. Poison Pill

    A strategy used by corporations to discourage hostile takeovers. ...
  6. Investment Banker

    An individual who works in a financial institution that is in ...
RELATED FAQS
  1. Why should management teams focus more on horizontal integration?

    Management teams should focus more on horizontal integrations because they allow for economies of scale, economies of scope, ... Read Full Answer >>
  2. Why are the terms 'merger' and 'acquisition' always used together if they describe ...

    The terms "merger" and "acquisition" are used together because they both describe processes by which two companies become ... Read Full Answer >>
  3. What level of mergers and acquisitions is common in the chemical sector?

    The level of mergers and acquisitions (M&As) in the chemicals sector has surged to an all-time high since the turn of ... Read Full Answer >>
  4. How can a company buy back shares to fend off a hostile takeover?

    There are several reasons why a company may choose to repurchase some or all of the outstanding shares of its stock. This ... Read Full Answer >>
  5. How does the level of mergers and takeovers in the Internet sector compare to the ...

    The level of mergers and takeovers in the Internet sector is higher than in the broader market. The Internet sector contains ... Read Full Answer >>
  6. What business structures expose entrepreneurs to unlimited liability?

    A company that seeks to expand through a horizontal integration can achieve economies of scale, economies of scope, increased ... Read Full Answer >>
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. Forex Education

    Mergers & Acquisitions: An Avenue For Profitable Trades

    When major corporate transactions have a big impact on the currency markets, you can benefit.
  3. Mutual Funds & ETFs

    The Buy-Side Of The M&A Process

    With almost $2 trillion in sales yearly, find out how these mergers and acquisitions take place.
  4. Insurance

    The Wonderful World Of Mergers

    While acquisitions can be hostile, these varied mergers are always friendly.
  5. Options & Futures

    The Basics Of Mergers And Acquisitions

    Learn what corporate restructuring is, why companies do it and why it sometimes doesn't work.
  6. Economics

    What are Pork-Barrel Politics?

    Pork-barrel politics is a form of patronage whereby politicians favor their constituents in exchange for benefits such as campaign donations and votes.
  7. Investing

    American Airlines & US Airways Merger: It Matters!

    While the two airlines' merger creates a new giant in the industry and reduces choice for consumers and employees, investors should benefit.
  8. Economics

    What is a Management Buyout?

    A management buyout, or MBO, is a transaction where a company's management team purchases the assets and operations of the business they manage.
  9. Fundamental Analysis

    Explaining Enterprise Multiple

    The enterprise multiple is a ratio used to value a company as if it was going to be acquired.
  10. Chart Advisor

    3 Basic Material Stocks Poised For A Pop

    After large market swings such as the one seen on March 30, 2015, it is not surprising to see traders become more tolerant towards taking on risk.

You May Also Like

Hot Definitions
  1. Stop-Loss Order

    An order placed with a broker to sell a security when it reaches a certain price. A stop-loss order is designed to limit ...
  2. Covered Call

    An options strategy whereby an investor holds a long position in an asset and writes (sells) call options on that same asset ...
  3. Butterfly Spread

    A neutral option strategy combining bull and bear spreads. Butterfly spreads use four option contracts with the same expiration ...
  4. Unlevered Beta

    A type of metric that compares the risk of an unlevered company to the risk of the market. The unlevered beta is the beta ...
  5. Moving Average - MA

    A widely used indicator in technical analysis that helps smooth out price action by filtering out the “noise” from random ...
  6. Yield Curve

    A line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity ...
Trading Center