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Negotiated Share Repurchase |
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Greenmail A practice in which a corporate raider buys a large amount of stock from another publicly-traded company and forces the latter to buy back the stock at a substantial premium in order to avoid a takeover. The corporate raider has no intention of actually buying the target company; it merely seeks to profit from the buyback. One refers to this buyback as a bon voyage bonus, as this enables the company to be left alone by the greenmailer. Some companies formulate anti-greenmail provisions in their charters or bylaws to prevent the situation from occurring in the first place.
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