Virtual General Counsel LLC
Virtual General Counsel LLC

Helping Startups And Complex Business Clients
Services Throughout Denver And The Surrounding Areas

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Hostile acquisitions: What is the white knight defense?

| Apr 14, 2020 | Mergers & Acquisitions |

As a business owner in the Denver, CO, area, you are deeply committed to protecting your business interests. Protective measures can take many forms. Sometimes, a business merger is the best way to ensure your business endures and continues to thrive. Mergers are something all parties agree to and are rarely hostile.

What if another company seeks to take over the business you have worked so hard to create? You may think your company is safe from an unwanted acquisition, but it might be more at risk than you think. You have probably heard the term hostile acquisition or hostile takeover, which means that one company tries to take over another by way of shareholder voting.

Now, if the acquisition seems as if it will benefit your company or your bottom line, you might not resist too hard. However, it is critically important to seek legal assistance to guide you through mergers and acquisitions, especially hostile takeovers. Professional counsel helps you make certain that the acquisition is in your company’s best interests.

Consider the “white knight defense.” This is a way that you can avoid a hostile acquisition by seeking a different company to sell your business to or perhaps to merge with. An attorney skilled in the field of mergers and acquisitions can also help with this defense by investigating the new company. This helps you identify if the “white knight” (the new company) is a good match for your company’s needs.

The white knight defense is just one way to protect your company against a hostile takeover. Ask a lawyer about other ways to accomplish your company’s preservation goals.