friendly takeover

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Friendly takeover

Merger when the target firm's management and board of directors is in favor of the takeover. Antithesis of hostile takeover.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Friendly Takeover

The acquisition of one company by another with the full knowledge and consent of the target company's board of directors. Generally speaking, a friendly takeover requires the approval of shareholders in addition to the board of directors, but, in this case, shareholders tend to follow the board's lead. This is because, in a friendly takeover, the acquiring company offers a premium to the current stock price for each share. See also: Hostile takeover.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

friendly takeover

The acquisition of a firm with approval of the acquired firm's board of directors. Compare unfriendly takeover.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.
References in periodicals archive ?
The strategies for surviving a friendly acquisition are similar to those for a merger.
* Maximize the efficiency of the service territory, i.e., if the service territory is not configured in a logical manner, sell off or trade some of the service territory; if service area surrounds a municipal system or investor-owned utility (IOU), explore ways to improve working relationships with the utility by sharing services, supplies, etc., or pursue a friendly acquisition of the system or portions of the system.
Whether through merger, friendly acquisition or hostile takeover, the retructuring of American industry has reshaped the corporate landscape.
Alamos Gold is proposing a friendly acquisition of Richmont Mines' flagship Island Gold Mine in a $933-million all-stock deal.
In addition Popoff is a principle founder in Vitruvian Acquisitions Ltd, a private capital firm that seeks to assist business owners of well established SMEs into retirement through the friendly acquisition of their shares.
The company also has the option of countering Steel Partners by finding a ''white knight'' business enterprise to mount a friendly acquisition, an industry source said.
* June 2--PeopleSoft declares its intention to acquire JD Edwards in a $1.7bn stock-based friendly acquisition.
Norwest expanded the reach of Indopco by requiring the capitalization of the target corporation's officers' salaries in a friendly acquisition. The taxpayer argued that the officers' salaries were ordinary and necessary business expenses because the officers working on the transaction were only involved tangentially in the merger, while their time was primarily spent carrying out their ordinary duties.
9 (1999), the Tax Court determined that officers' salaries and legal fees incurred by a target company in a friendly acquisition were required to be capitalized, because they were sufficiently related to an event that produced a significant long-term benefit.
Careful planning is necessary when a company incurs expenses to resist a hostile takeover while implementing a friendly acquisition. Taxpayers must be prepared to provide evidence of the expenditures' nature and should request itemized bills from investment bankers and legal advisers distinguishing between expenses to resist an undesirable suitor and those to encourage a white knight.