bear hug

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Bear hug

Often used in risk arbitrage. Hostile takeover attempt in which the acquirer offers an exceptionally large premium over the market value of the acquiree's shares so as to as to squeeze (hug) the target into acceptance.

Bear Hug

An offer by a company to buy another company for a price per share far above the share price's fair market value. A company offers a bear hug when it believes the target company's management may decline the offer. Because the management has a fiduciary responsibility to act in the best interest of shareholders, the bear hug is essentially an offer the management cannot refuse, at least not without exposing itself to a lawsuit. It is a form of a hostile takeover and may be used as a form of risk arbitrage.

bear hug

A buyout offer so favorable to stockholders of a company targeted for acquisition that there is little likelihood they will refuse the offer. Not only does a bear hug offer a price significantly above the market price of the target company's stock, but it is likely to offer cash payments as well. See also takeover.
Case Study Following rejection by the General Motors board of an EchoStar Communications takeover proposal for GM-controlled Hughes Electronics, owner of DirectTV, EchoStar soon made another surprise bid to acquire Hughes. At the time of the bid Hughes's equity was trading on the New York Stock Exchange as a tracking stock. The second bid, announced with a public letter addressed to the GM board, was a bear hug offer made directly to Hughes's stockholders. Believing that General Motors directors were likely to recommend a sale of Hughes to Rupert Murdoch's News Corp., EchoStar felt it could only be successful by offering a higher price to Hughes's shareholders. The higher price would appeal to Hughes's shareholders and make it more difficult for GM directors to recommend a sale at a lower price to another company. GM directors rejected the earlier EchoStar offer in part because they felt the combination of DirectTV and EchoStar would be unacceptable on an antitrust basis. Rupert Murdoch later pulled out of the bidding for Hughes.
References in periodicals archive ?
We know that Luvs with Bear Hug Stretch will help families do just that," he says.
PHOTO : Another "Skeeter Skelton Style" handgun grip, but in rosewood, from Bear Hug grips.
The officer added: "The teacher was frozen to the spot - the bear hug was quite strong and she couldn't move.
THE WEATHER Ellie Nathalie Press Bob Jonathan Coy Gall Helen Schlesinger Maria Mia Soteriou Frank Alex Robertson With: Grace Willow BEAR HUG Linda Helen Schlesinger David Jonathan Coy Michael Alex Robertson
But at the final whistle - with England crushing the Springboks 25-6 - he lifted Jane off her feet in a bear hug as they both yelled for joy.
He received applause for helping to make history--Judson Dance Theater is recognized as the cradle of postmodern dance (see "Misha's New Passion," DANCE MAGAZINE, November 2000, page 54)--and a bear hug from Rainer.
Placing the suspect in a bear hug, the former Marine drill instructor yelled to bystanders to call police.
I would like to thank this little boy, whoever you are, for your kind words and don't forget, if you see me in town come and give me a big bear hug.
Married Hogan's attention was also drawn by another guest - agony aunt Denise Robertson, who jokily declared an interest in taking him up on a tight bear hug if he became available.
Mr Todd revealed yesterday that Det Con Oake held Bourgass in a bear hug while he lashed out with a large kitchen knife, clinging on until he was subdued and disarmed by colleagues, despite being stabbed himself.
I can not even imagine what is like to have such sensitive skin that you can not get a big bear hug or feel anxious being in crowds in case someone bumps into you.
Years before my father and I had "the talk"--before he promised he'd love me no matter what, gave my boyfriend a bear hug, and said he was welcome in his home anytime--their existed an entirely different relation ship between us.