Posted in Finance, Accounting and Economics Terms, Total Reads: 521
Definition: Acting In Concert
This is an informal term used in reference with mergers and acquisitions to define a situation where two parties are taking identical investment decisions to achieve the same goal. This might be frowned upon in some scenarios.
It is also known as concert party arrangements, and is defined by the City Code on Mergers and takeovers as an act of formal or informal understanding or agreement between persons acting in concert. This is done so as to obtain control of a firm or even to upset the outcome of an offer. In this context according to the Code, control refers to 30% of voting rights in the desired target company.
For example, if 2 companies come together and buy shares in another company with an intention to takeover without having to declare, they are acting in concert. They might be expected to declare when they collectively cross a particular minimum requirement.