Posted in Finance, Accounting and Economics Terms, Total Reads: 238
Definition: Friendly Takeover
A friendly takeover is defined as the merger or the acquisition of Target Company by the acquiring company with the approval of directors and owners of the target company. Another way of friendly takeover is to purchase the controlling assets by the acquiring companies; In this case the acquiring company may use the assets of Target Company in its future operations.
Takeover is defined as when a shareholder or group of shareholder acquire or buy more than 50% share of target corporation shares. A takeover can be a friendly takeover or Hostile takeover.
On the other hand, an Hostile takeover, the acquisition is not approved by the owners or the directors of the target company. In Hostile takeover, the acquirer company offers to buy the shares from the shareholders of Target Company in cash. If the acquirer is successful in buying more than 50% of share then the control of Target Company goes to the acquiring company.