Bear Hug

A bear hug is a takeover offer made at a significant premium over the target company’s current market value, putting pressure on its board to accept the deal. This tactic is often used to bypass resistance from management and attract shareholder support, making it difficult for the target company to refuse. Bear hugs are common in the M&A landscape where companies seek quick and aggressive acquisitions.

Key Takeaways

  • Takeover bid offering a high premium to the target company.
  • Pressures the board to accept the deal.
  • Often bypasses management resistance.
  • Common in M&A for aggressive acquisitions.

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