Stalking horse

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Stalking horse

In bankruptcy proceedings, this refers to the company that first bids for the companies assets.

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.
References in periodicals archive ?
When hunting was the major source of food, hunters often used stalking horses as a means of sneaking up on their prey.
of California-Santa Barbara) takes the two figures as stalking horses for the confrontation between New World and Old World beliefs when European settlers arrived.
These seemingly unassuming images become stalking horses for inconspicuous distress signals worming their way toward our attention in Reeb's quieter paintings.
Other bids would have to top it by paying a "breakup fee" that the stalking horse would be entitled to.
The outburst from normally loyal Mr Smith comes amid speculation of a stalking horse challenge to Mr Blair as issues such as the war on Iraq and privatisation of public services fuel unrest.