Takeover Bid

What is a 'Takeover Bid'

A takeover bid is a type of corporate action in which an acquiring company makes an offer to the target company's shareholders to buy the target company's shares in order to gain control of the business. Takeover bids can either be friendly or hostile.

BREAKING DOWN 'Takeover Bid'

Some examples of takeover bids include:

Two-Tier Bid: The acquiring company is willing to pay a premium above and beyond the share's price in order to convince shareholders to sell their shares.

Any-and-All Bid: The acquiring company offers to buy any of the target firm's outstanding shares at a specific price.

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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. 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 >>
  3. 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 >>
  4. 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 >>
  5. What's the difference between a merger and a hostile takeover?

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  6. If a company offers a buyback of its shares, how do I decide whether to accept the ...

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