Stalking horse

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Stalking horse

In bankruptcy proceedings, this refers to the company that first bids for the companies assets.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

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.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved
References in periodicals archive ?
A stalking-horse now might actually beat Brown with the danger of a nonentity becoming PM!
Aceto announced that it has entered into a "stalking-horse" asset purchase agreement with an affiliate of New Mountain Capital, a leading growth-oriented investment firm with over $20 billion in assets under management, to sell its chemicals business assets for gross proceeds of $338 million in cash, plus the assumption of certain liabilities and subject to certain adjustments, on a cash-free and debt-free basis.
Seneca said its purchase agreement will serve as the "stalking-horse bid" in the auction process, meaning Seneca has the opportunity to match any other bids Aliens might receive.
21 May 2013 a[euro]" The chairman of US pay-TV company Dish Network Corp (NASDAQ:DISH) has made a USD2bn (EUR1.6bn) stalking-horse bid for radio frequencies that belong to bankrupt wireless-broadband firm LightSquared Inc, Bloomberg reported today, quoting sources.