Toehold purchase(redirected from toeholds)
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A toehold purchase is one in which an individual investor or investment firm caps holdings in a potential target company at less than 5% of the company's outstanding stock.
Presumably that's because once an investor has acquired 5% or more of the stock, the investor must notify the company, the market where the company is listed, and the Securities and Exchange Commission (SEC). That notification must explain the next steps the investor intends to take, such as a possible takeover bid.