DEFINITION of 'Whitemail'

A strategy that a takeover target uses to try and thwart an undesired takeover attempt. The target firm issues a large amount of shares at below-market prices, which the acquiring company will then have to purchase if it wishes to complete the takeover.

BREAKING DOWN 'Whitemail'

If the whitemail strategy is successful in discouraging the takeover, then the company can either buy back the issued shares or leave them outstanding.

RELATED TERMS
  1. Takeover

    A corporate action where an acquiring company makes a bid for ...
  2. "Just Say No" Defense

    A "just say no" defense is a strategy used by boards of directors ...
  3. Hostile Takeover

    A hostile takeover is the acquisition of one company by another ...
  4. Killer Bees

    Killer bees helped companies avoid takeovers, during the 198 ...
  5. Bailout Takeover

    Bailout takeover is an urgent acquisition of a financially unstable ...
  6. People Poison Pill

    A people pill is a defensive strategy to ward off a hostile corporate ...
Related Articles
  1. Investing

    Trademarks of a Takeover Target

    These tips on finding viable takeover targets can lead you to little companies with big prospects.
  2. Investing

    Mergers and acquisitions: Understanding takeovers

    In the language of mergers and acqusitions, battleground terms meld with bizarre metaphors to create a unique vocabulary.
  3. Small Business

    Corporate Takeover Defense: A Shareholder's Perspective

    Find out the strategies corporations use to protect themselves from unwanted acquisitions.
  4. Small Business

    How To Profit From Mergers And Acquisitions Through Arbitrage

    Making a windfall from a stock that attracts a takeover bid is an alluring proposition. But be warned – benefiting from m&a is easier said than done.
  5. Investing

    Poison Pill

    A poison pill is a corporate maneuver put in place to try and prevent a hostile takeover. The target corporation uses this strategy to make its stock less attractive to the acquirer. This is ...
  6. Insights

    Ariad Receives Interest as a Buyout Candidate

    Following failed buyout talks with Baxalta last year, Ariad’s stock is spiking amid rumors of a takeover.
  7. Investing

    Unilever Asks UK Govt. for ‘Level Playing Field’

    The company wants to extend the time allowed for takeover targets to defend themselves.
  8. Investing

    8 More Stocks That May Surge On 2018 Takeovers: Goldman Sachs

    M&A mania: following up on a previous story, here are 8 more stocks that Goldman tabs as likely buyout targets.
  9. Investing

    Megadeals Push Global Takeovers Past $1.2 Trillion

    Numerous factors are set to drive another record year for M&A, despite political uncertainty.
RELATED FAQS
  1. A Hostile Takeover vs. Friendly Takeover

    Learn about the difference between a hostile takeover and a friendly takeover, and understand how proxy fights and tender ... 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. What's the difference between a merger and a hostile takeover?

    Understand the difference between a merger and a hostile takeover, including the different ways one company can acquire another, ... Read Answer >>
  4. Why is a shareholder rights plan called a "poison pill?"

    Discover why shareholder rights plans are often called "poison pills" to fight hostile takeovers and give smaller corporations ... Read Answer >>
Hot Definitions
  1. Return On Equity - ROE

    The profitability returned in direct relation to shareholders' investments is called the return on equity.
  2. Working Capital

    Working capital, also known as net working capital is a measure of a company's liquidity and operational efficiency.
  3. Bond

    A bond is a fixed income investment in which an investor loans money to an entity (corporate or governmental) that borrows ...
  4. Compound Annual Growth Rate - CAGR

    The Compound Annual Growth Rate (CAGR) is the mean annual growth rate of an investment over a specified period of time longer ...
  5. Net Present Value - NPV

    Net Present Value (NPV) is the difference between the present value of cash inflows and the present value of cash outflows ...
  6. Price-Earnings Ratio - P/E Ratio

    The Price-to-Earnings Ratio or P/E ratio is a ratio for valuing a company that measures its current share price relative ...
Trading Center