Stalking horse bid

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Stalking horse bid

In bankruptcy proceedings, this refers to first bid for the companies assets. This is the bid to beat. If there are multiple bids, often there is a bankruptcy auction.

Stalking Horse Bid

1. In a corporate bankruptcy in which the corporation wishes or is required to sell its assets, an initial bid on those assets by a third party chosen by the corporation. This is done to ensure that the bankrupt corporation does not have to settle for unacceptably low prices for its assets.

2. More generally, a "trial balloon" in which a third party approaches a person or company inquiring about the possibility of a (usually hostile) takeover. The party actually asking about the takeover remains anonymous so as to protect its reputational risk in case the idea does not meet with favor.
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References in periodicals archive ?
Stalking horse bids are common in bankruptcies and allow the seller to pick an initial bidder.
A bankruptcy judge has approved the stalking horse bids for the various brands from Flowers Foods Inc (NYSE:FLO), McKee Foods Corp, United States Bakery Inc, Apollo Global Management LLC (NYSE:APO) and C Dean Metropoulos & Co.
A bankruptcy court sale is scheduled for September however, stalking horse bids will also be considered for the properties.
28 January 2013 - Bankrupt US wholesale baker Hostess Brands Inc is nearing agreement over two stalking horse bids targeting its Drake's cakes operations and four bread businesses, an informed person told Reuters today.
28 January 2013 a[euro]" Bankrupt US wholesale baker Hostess Brands Inc is nearing agreement over two stalking horse bids targeting its Drakea[euro](tm)s cakes operations and four bread businesses, an informed person told Reuters today.