Hostile Takeover – when losing is winning

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  • #51659
    Lauren Zinsmeister
    Participant

    It was interesting to learn how Cadbury ultimately ended up in a deal with Kraft that their shareholders wanted, even though it started out as a hostile situation which was personally and professionally upsetting to so many. Cadbury’s smart tactics turned a bad situation into something that was ultimately good for its shareholders, which is ultimately the people to whom they are accountable. However, the company and brand were sentimental and had deep roots in the national and local history. Does anyone think there’s a time when a company should continue to fight a takeover even if their shareholders become convinced the deal should go through?

    #51693
    Jesslyn Zeng
    Participant

    Very much depends on the circumstances when deciding whether a company should continue to fight a takeover even if their shareholders become convinced that the deal should go though – if the deal is absolutely necessary to ensure the survival of the company moving forward, the company should perhaps not fight a takeover; however, on the other hand, if the company directors are convinced that it is indeed the best interests of the company’s stakeholders (including the shareholders), then efforts should be directed at ensuring that the shareholders are made aware of the advantages and disadvantages of such pursuits. After all, the best interests of the stakeholders – including the employees, shareholders and the company itself – are of paramount importance.

    #52191
    Abdullah Aziz
    Participant

    That will be very challenging for the management.

    But, I believe the key here is if the management believes that the company’s future with the current owners is better than with the acquirers, even if they offered a great offer.

    The areas that the company need to focus on are business plan, future investments, current experience and future owner capabilities.

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