What is 'In Play'

In play refers to a firm that has become a potential takeover target or has put itself up for sale and may have multiple bidders. A company may initially only be rumored to be part of a potential merger or acquisition or a management buyout, at which point its shares may be referred to as deal stock with the share price becoming more volatile due to speculation. Once a bid for the firm is made, a company is put "in play" and may attract additional bidders.

BREAKING DOWN 'In Play'

When a firm becomes a potential takeover target, its share price may increase on the expectations the stock will trade at a premium before or at final purchase of outstanding shares. For example, in the late 1980s, management at RJR Nabisco made a bid to take the company private in the course of a hostile takeover attempt. This bid put the company in play, and the resulting bidding war elevated the offer ultimately approved by the RJR Nabisco board.

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RELATED FAQS
  1. What are some of the top hostile takeovers of all-time?

    Learn about some of the most noteworthy hostile takeovers in history, including the KKR acquisition of RJR Nabisco and the ... Read Answer >>
  2. What happens to the shares of a company that has been the object of a hostile takeover?

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  4. What is the difference between a merger and a takeover?

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  5. What do the bid and ask prices represent on a stock quote?

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