Who Is the Hostile Takeover?

A hostile takeover occurs when an acquiring company attempts to take over a target company against the wishes of the target company's management. An acquiring company can achieve a hostile takeover by going directly to the target company's shareholders or fighting to replace its management.

Who is considered hostile in a hostile takeover?

a hostile takeover is the result of a situation where the incumbent board of the company, and some percentage of its shareholders, are refusing to sell the company to a would-be buyer.

Is a hostile takeover good for shareholders?

Hostile takeovers, even if unsuccessful, typically lead management to make shareholder-friendly proposals as an incentive for shareholders to reject the takeover bid. These proposals include special dividends, dividend increases, share buybacks, and spinoffs.