When a company is looking to acquire another company, they will often negotiate a purchase price. This purchase price is typically based on the value of the target company’s assets. However, sometimes the two companies will agree on a purchase price that is less than the value of the target company’s assets. This is known … Read more
A hostile takeover is an acquisition of one company by another in which the target company’s management opposes the acquisition. A hostile takeover can be accomplished in several ways, but the most common is for the acquiring company to simply purchase enough shares of the target company on the open market to gain control of … Read more
Whitemail is a type of merger or acquisition in which the target company is purchased for a premium price by another company that is willing to pay that price in order to gain control of the target company’s operations. The name “whitemail” comes from the fact that the premium price is often paid in cash, … Read more
How to Create Pro Forma Financial Statements What are the basic benefits and purposes for a company to develop pro forma statements and a cash budget what key factors go into developing these statements? A pro forma statement is a financial statement that shows the expected future financial performance of a company. A cash budget … Read more
A whitewash resolution is a type of corporate resolution that is used to approve a merger or acquisition without the need for a shareholder vote. This type of resolution is typically used when the shareholders of the target company are also the shareholders of the acquiror. What is a whitewash report? A whitewash report is … Read more
A standstill agreement is a contract between two companies that establishes a temporary period of peace between them. The agreement may be used to prevent a hostile takeover, allow for negotiations, or simply to give both parties time to assess the situation. Standstill agreements typically last for a set period of time, after which the … Read more
Intercorporate investment is an investment made by one corporation in another. This can take the form of equity investment, loans, or the purchase of assets. The purpose of intercorporate investment is typically to gain a financial stake in the other company, expand one’s business operations, or both. There are several reasons why a corporation might … Read more
A raider is an individual or company that acquires a controlling interest in a company by acquiring a large number of its shares. Raiders typically seek to take control of the target company in order to make changes that they believe will increase its value, such as selling off assets, changing management, or taking the … Read more
A megamerger is a very large corporate merger or acquisition that involves two or more companies with a combined market value of $10 billion or more. Megamergers are usually done in order to increase market share, economies of scale, or product offerings. What is an example of a mega merger? A mega merger is defined … Read more
A white knight is a friendly acquirer that is brought in by a target company to ward off a hostile takeover by another company. A white knight acquirer is typically chosen because it is seen as a better alternative to the hostile acquirer, in terms of both financial and strategic fit. The term “white knight” … Read more
