Hostile Takeover
Definition
A hostile takeover is an acquisition attempt made directly to a company’s shareholders, against the wishes of its board and management. Instead of negotiating a friendly deal, the bidder goes over the board’s head, typically through a tender offer or a proxy fight.
In practice
Hostile deals defined the 1980s, when raiders like Carl Icahn and T. Boone Pickens showed that even the largest companies could be put in play. Most hostile approaches end in a negotiated deal or a sale to a white knight rather than an outright victory, but the pressure alone forces boards to act.