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Hostile Bids and Stocks in the Company

Suppose you own stock in a company. The current price is $25. Another company has just announced that it wants to buy your company and will pay $35 per share to acquire all the outstanding stock. Your company's management immediately begins fighting off this hostile bid. Is management acting in the shareholder's best interests? Why or why not?

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It depends on the reason why your compnay's management is rejecting this bid, and the ultimate reason is they think the bid is too low.

Case 1

Say the management (hereafter mgt) is willing to sell the shares at $30, and is fighting off this hostile bid in hopes that tthe bidder will increase the bid. In this case the mgt is acting in the shareholders best ...