Takeover and its Defense Mechanism - PPT.ppt

Takeover and its Defense Mechanism

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Takeover and its Defense
Mechanism

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CONTENTS
1.Meaning and Concept
2.Who can be a acquirer?
3.Kinds of Takeover
4.Forms of Takeover
5.Advantages Of Takeover
6.Disadvantages of takeover
7.Defense Measures
8.Comparison
9.Case law

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Meaning and Concept
What is takeover??
Acquisition of shares with a view to gain
control over the management
Over
The

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>>Individual
>>Group of individuals ,
>>Company
>>Any other legal entity or Persons Acting
in Concert with the acquirer.
Who can be a acquirer??

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Kinds of takeover
Friendly Takeover Hostile TakeoverBailout Takeover

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Advantages of Takeover
•Reduces overcapacity in industry.
•Helps acquirer to expand the brand portfolio.
•Generates benefits of economies of scale.
•Helps attain increased efficiency as a result of
corporate synergies
•Helps in eliminating jobs that overlap in
responsibilities
•Reduces overcapacity in industry.
•Helps acquirer to expand the brand portfolio.
•Generates benefits of economies of scale.
•Helps attain increased efficiency as a result of
corporate synergies
•Helps in eliminating jobs that overlap in
responsibilities

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•Reduces competition and choice for consumers.
•Results in job cuts.
•Cultural differences lead to conflict.
•Acquirer often burdened with hidden liabilities
of the target entity.
•Employees of the target company work in an
environment of fear and uncertainty affecting
motivational levels.
Disadvantages of Takeover

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Defense Measures
Staggered Board
Poison Pills
Super-Majority Amendment
Golden Parachutes
Proactive Defense Measures

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Reactive Defense Measures
Defense Measures
Attack the Logic of The Bid”
White Knight & White Squire
Greenmail
Crown Jewel
Litigation

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Are Takeovers Positive or Negative?

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Comparison

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Comparison

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Comparison

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Comparison Comparison

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Comparison

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Comparison

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CASE LAW
Banarasi Das Saraf & Others
v.
Dalmia Dadri Cement Ltd

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