Shark Repellent

What is 'Shark Repellent'

Shark repellent is a slang term for any one of a number of measures taken by a company to fend off an unwanted or hostile takeover attempt. In many cases, a company will make special amendments to its charter or bylaws that become active only when a takeover attempt is announced or presented to shareholders with the goal of making the takeover less attractive or profitable to the acquisitive firm.

Also known as a "porcupine provision."

BREAKING DOWN 'Shark Repellent'

Most companies want to decide their own fates in the marketplace, so when the sharks attack, shark repellent can send the predator off to look for a less feisty target.

While the concept is a noble one, many shark repellent measures are not in the best interests of shareholders, as the actions may damage the company's financial position and interfere with management's ability to focus on critical business objectives. Some examples of shark repellents are poison pills, scorched earth policies, golden parachutes and safe harbor strategies

RELATED TERMS
  1. Killer Bees

    An individual or firm that helps a company fend off a takeover ...
  2. Safe Harbor

    1. A legal provision to reduce or eliminate liability as long ...
  3. Shark Watcher

    A firm specializing in the early detection of takeovers. The ...
  4. Loan Shark

    A person or entity that charges borrowers interest above an established ...
  5. Hostile Takeover

    The acquisition of one company (called the target company) by ...
  6. Scorched Earth Policy

    A takeover prevention strategy in which the target company seeks ...
Related Articles
  1. Entrepreneurship & Small Business

    Is it Time to Take Your Company to Shark Tank?

    Understand the key factors an entrepreneur should consider when thinking about whether it might be time to try to go to "Shark Tank."
  2. 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.
  3. Investing

    5 Things Investors Can Learn From Shark Tank

    Retail investors can watch "Shark Tank" to learn how the wealthy analyze investment opportunities.
  4. Entrepreneurship & Small Business

    10 Most Successful Products from Shark Tank

    With seven seasons, 7.5 million viewers, some studs and a whole lot of duds, we take a look at the 10 most successful products to come out of ABC's Shark Tank.
  5. Investing

    The Advantages Of Investing In Aggressive Companies

    Often the most attractive companies are also a little fierce - learn how to spot healthy corporate aggression.
  6. Entrepreneurship & Small Business

    Should I Apply to 'Shark Tank' or 'The Profit'?

    In this article, we'll help you determine whether or not your business can benefit from appearing on Shark Tank and The Profit.
  7. 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 ...
  8. Investing

    What is a Takeover?

    A takeover happens when one company makes a bid to acquire a target company.
  9. Entrepreneurship & Small Business

    3 Shark Tank Failures That Made Millions

    Learn how some of the most successful companies rejected on the TV show "Shark Tank" left the show with no funding and still made millions.
  10. Trading

    Pinpoint Takeovers First

    Use these seven steps to discover a takeover before the rest of the market catches on.
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. How effective is a poison pill defense against a hostile takeover?

    Learn about the different types of poison pill strategies that target companies use to prevent hostile takeovers, and understand ... Read Answer >>
  6. If a company offers a buyback of its shares, how do I decide whether to accept the ...

    Learn why it may often be in the best interest of a shareholder to accept a tender offer made at a premium to the market ... Read Answer >>
Hot Definitions
  1. GBP

    The abbreviation for the British pound sterling, the official currency of the United Kingdom, the British Overseas Territories ...
  2. Diversification

    A risk management technique that mixes a wide variety of investments within a portfolio. The rationale behind this technique ...
  3. European Union - EU

    A group of European countries that participates in the world economy as one economic unit and operates under one official ...
  4. Sell-Off

    The rapid selling of securities, such as stocks, bonds and commodities. The increase in supply leads to a decline in the ...
  5. Brazil, Russia, India And China - BRIC

    An acronym for the economies of Brazil, Russia, India and China combined. It has been speculated that by 2050 these four ...
  6. Brexit

    The Brexit, an abbreviation of "British exit" that mirrors the term Grexit, refers to the possibility of Britain's withdrawal ...
Trading Center