When a hostile takeover appears to be inevitable, a target company will sometimes look for another, friendlier company to acquire it called a:

Question

BlackTom AI · Accepted Answer

In evaluating defenses against an imminent hostile takeover, we need to consider common corporate strategies and terminology.
Option 1: 'white knight' — This describes exactly the scenario where a friendlier, more acceptable company acquires the target to block the hostile bidder. It is a classic defense tactic meant to replace the hostile bid with a more palatable one. Therefore, this option matches the described situation.
Option 2: 'golden parachute' — A golden parachute is a financial agreement that provides severance pay or benefits to executives if they are terminated after a merger or takeover. While it relates to takeovers, it is not a mechanism for finding a friendlier acquirer; it’s more about executive compensation and risk management for leadership, not about changing the takeover bidder.
Option 3: 'selling off the crown jewels' — This refers to divesting valuable assets to make the company less attractive or to raise cash, potentially discouraging a takeover. It is a defensive move in some takeovers but not the standard term for bringing in a friendlier bidder who would acquire the company.
Option 4: 'poison pill' — A poison pill is a defensive tactic that makes the target less attractive or more expensive to acquire, usually by diluting the bidder’s stake or creating other obstacles. While it serves to deter hostile bids, it does not describe bringing in a friendly acquirer to purchase the company.
Thus, by matching the description of seeking a friendlier acquirer to take over, the first option aligns with the concept described, whereas the other options describe different takeover defenses or strategies that do not fit the scenario.

MGT232H5 S LEC0105 Quiz 5

When a hostile takeover appears to be inevitable, a target company will sometimes look for another, friendlier company to acquire it called a:

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