Proxy Fight

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Proxy fight

Often used in risk arbitrage. Technique used by an acquiring company to attempt to gain control of a takeover target. The acquirer tries to persuade the shareholders of the target company that the present management of the firm should be ousted n favor of a slate of directors favorable to the acquirer, thus enabling the acquiring company to gain control of the company without paying a premium price.

Proxy Fight

Competition of outside group with management for stockholders' proxies in order to accumulate votes to elect a new board of directors.

Proxy Fight

A situation in which two investors (usually two companies) compete with one another in the attempt to gain the proxy votes of shareholders in a third company. The two investors engage in the proxy fight because both wish to have enough proxy to elect a new board of directors that will effectively do whatever the investor wants. The winner of a proxy fight, if any, is able to control the third company through the board of directors and does not need to directly acquire it, though many often do anyway.

proxy fight

A contest among two or more opposing forces to solicit stockholders' proxies and, in effect, to gain control of the firm through the election of directors. It is usually quite difficult to wrest control from the existing management through a proxy fight, but the tactic has been used, for example, by some suitors in takeover attempts.
References in periodicals archive ?
Corresponding to the first, the second and the fourth rule amendments, as expected, the occurrence rate as measured by the number of listed companies with proxy contests divided by the number of listed companies--lowered respectively from 0.
Commenter requests that the Board hold a public hearing to give Comenter the opportunity to question First Mariner and to obtain additional information about Commenter's alleged violations of law in connection with the proxy contest discussed above.
The initial data sample contains all target firms that received tender offers for control or experienced proxy contests for board seats from 1978 to 1985.
Factors Which Have Increased The Use of Proxy Contests
Fifty-five companies which have had proxy contests for control during the period 1970 to 1986 were selected for inclusion in the study.
Similarly, Mulherin and Poulsen's |10~ evidence suggests that significant improvements in firms' accounting performance subsequent to proxy contests depends on the presence of a takeover bid at the time of dissident activity.