Definition of Friendly takeover:
A friendly takeover is the act of target company's management and board of directors agreeing to be absorbed by an acquiring company. Such action is typically subject to approval by both the target company’s shareholders and the U.S. Department of Justice (DOJ). In situations where the DOJ fails to grant approval for a friendly takeover, it's typically because the deal violates antitrust (anti-monopoly) laws.
Acquisition of one firm by another where the owners of both firms agree to the terms of the takeover transaction.
In a friendly takeover, a public offer of stock or cash is made by the acquiring firm. The board of the target firm will publicly approve the buyout terms, which subsequently must be greenlit by shareholders and regulators, in order to continue moving forward. Friendly takeovers stand in stark contrast to hostile takeovers, where the company being acquired does not approve of the buyout, and often fights against the acquisition.
How to use Friendly takeover in a sentence?
- Friendly takeovers are subject to approval by the target company's shareholders, who generally greenlight deals only if they believe the price per share offer is reasonable.
- A friendly takeover is a scenario in which a target company is willingly acquired by another company.
- Friendly takeover deals must achieve regulatory approval by the U.S. Department of Justice (DOJ).
Meaning of Friendly takeover & Friendly takeover Definition