What is Unsolicited Bid?

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An unsolicited bid is an offer made by an individual, investor, or company to purchase a company that is not actively seeking a buyer. Unsolicited bids may sometimes be referred to as hostile bids if the target company doesn't want to be acquired. They usually come up when a potential acquirer sees value in the target company.

Definition

An unsolicited offer refers to a takeover bid made by an individual, investor, or company to a company that is not actively seeking buyers. If the target company is unwilling to be acquired, an unsolicited offer may sometimes be referred to as a hostile takeover. These offers typically occur when a potential buyer sees value in the target company.

Origin

The concept of unsolicited offers originated in the mid-20th century when corporate mergers and acquisitions began to increase. As capital markets developed, investors and companies realized that acquiring companies not actively seeking sale could lead to rapid expansion and increased market share.

Categories and Features

Unsolicited offers can be categorized into friendly and hostile types. Friendly offers are typically made with mutual agreement, while hostile offers occur when the target company's management opposes the acquisition. The advantage of friendly offers is fewer legal and operational hurdles, whereas hostile offers may require more legal strategies and tactics to overcome the target company's resistance.

Case Studies

A classic example is the 2008 acquisition of Anheuser-Busch by InBev. Despite initial resistance from Anheuser-Busch, InBev succeeded by raising its offer and directly communicating with shareholders. Another example is the 2014 hostile takeover bid by Valeant Pharmaceuticals for Allergan, which, although ultimately unsuccessful, highlighted the complexities and challenges of hostile offers.

Common Issues

Investors dealing with unsolicited offers may face legal challenges and resistance from the target company's management. Additionally, hostile offers can lead to cultural clashes and decreased employee morale. Investors should carefully assess the target company's value and potential integration risks.

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Political risk is the risk an investment's returns could suffer as a result of political changes or instability in a country. Instability affecting investment returns could stem from a change in government, legislative bodies, other foreign policymakers or military control. Political risk is also known as "geopolitical risk".

Political Risk

Political risk is the risk an investment's returns could suffer as a result of political changes or instability in a country. Instability affecting investment returns could stem from a change in government, legislative bodies, other foreign policymakers or military control. Political risk is also known as "geopolitical risk".

A direct quote is a foreign exchange rate quoted in fixed units of foreign currency in variable amounts of the domestic currency. In other words, a direct currency quote asks what amount of domestic currency is needed to buy one unit of the foreign currency—most commonly the U.S. dollar (USD) in forex markets. In a direct quote, the foreign currency is the base currency, while the domestic currency is the counter currency or quote currency.This can be contrasted with an indirect quote, in which the price of the domestic currency is expressed in terms of a foreign currency, or what is the amount of domestic currency received when one unit of the foreign currency is sold. Note that a quote involving two foreign currencies (or one not involving USD) is called a cross currency quote.

Direct Quote

A direct quote is a foreign exchange rate quoted in fixed units of foreign currency in variable amounts of the domestic currency. In other words, a direct currency quote asks what amount of domestic currency is needed to buy one unit of the foreign currency—most commonly the U.S. dollar (USD) in forex markets. In a direct quote, the foreign currency is the base currency, while the domestic currency is the counter currency or quote currency.This can be contrasted with an indirect quote, in which the price of the domestic currency is expressed in terms of a foreign currency, or what is the amount of domestic currency received when one unit of the foreign currency is sold. Note that a quote involving two foreign currencies (or one not involving USD) is called a cross currency quote.

Intellectual Capital

Intellectual capital is the value of a company's employee knowledge, skills, business training, or any proprietary information that may provide the company with a competitive advantage.Intellectual capital is considered an asset. It is the sum of employee expertise, organizational processes, and other intangibles that contribute to a company's bottom line.Some of the subsets of intellectual capital include human capital, information capital, brand awareness, and instructional capital.

Intellectual Capital

Intellectual capital is the value of a company's employee knowledge, skills, business training, or any proprietary information that may provide the company with a competitive advantage.Intellectual capital is considered an asset. It is the sum of employee expertise, organizational processes, and other intangibles that contribute to a company's bottom line.Some of the subsets of intellectual capital include human capital, information capital, brand awareness, and instructional capital.

Checking Account

A checking account is a deposit account that allows you to easily make withdrawals, deposits, and fund transfers. Also called demand accounts or transactional accounts, checking accounts can be accessed using checks, automated teller machines (ATMs), and electronic debits, among other methods. They are often used to keep money for short-term expenses.

Checking Account

A checking account is a deposit account that allows you to easily make withdrawals, deposits, and fund transfers. Also called demand accounts or transactional accounts, checking accounts can be accessed using checks, automated teller machines (ATMs), and electronic debits, among other methods. They are often used to keep money for short-term expenses.

Normal Distribution

Normal distribution, also known as the Gaussian distribution, is a probability distribution that is symmetric about the mean, showing that data near the mean are more frequent in occurrence than data far from the mean.In graphical form, the normal distribution appears as a "bell curve".

Normal Distribution

Normal distribution, also known as the Gaussian distribution, is a probability distribution that is symmetric about the mean, showing that data near the mean are more frequent in occurrence than data far from the mean.In graphical form, the normal distribution appears as a "bell curve".

A hiring freeze is when an employer stops hiring workers, usually temporarily, in an effort to contain costs. Such cost-cutting may be the result of financial distress, but even large, successful companies may opt to pause hiring amid an economic slowdown, recession or instances of overcapacity.

Hiring Freeze

A hiring freeze is when an employer stops hiring workers, usually temporarily, in an effort to contain costs. Such cost-cutting may be the result of financial distress, but even large, successful companies may opt to pause hiring amid an economic slowdown, recession or instances of overcapacity.