greenmail

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Greenmail

The holding of a large block of stock of a target company by an unfriendly company, with the object of forcing the target company to repurchase the stock at a substantial premium to prevent a takeover.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

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.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

greenmail

A defensive maneuver aimed at thwarting a potential takeover in which the target firm purchases shares of its own stock from a raider at a price above that available to other stockholders, who are ordinarily excluded from the transaction. Funds to finance greenmail are often borrowed, in which case the target company may end up with substantial additional debt. Also called negotiated share repurchase. Compare antigreenmail provision. See also fair price amendment.
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.

greenmail

see TAKEOVER BID.
Collins Dictionary of Business, 3rd ed. © 2002, 2005 C Pass, B Lowes, A Pendleton, L Chadwick, D O’Reilly and M Afferson

greenmail

see TAKEOVER BID.
Collins Dictionary of Economics, 4th ed. © C. Pass, B. Lowes, L. Davies 2005