On takeovers going hostile1 min read

Google terms Microsoft’s $44.6 billion bid to acquire Yahoo as hostile, in its official blog.

The openness of the Internet is what made Google — and Yahoo! — possible. A good idea that users find useful spreads quickly. Businesses can be created around the idea. Users benefit from constant innovation. It’s what makes the Internet such an exciting place.

So Microsoft’s hostile bid for Yahoo! raises troubling questions. This is about more than simply a financial transaction, one company taking over another. It’s about preserving the underlying principles of the Internet: openness and innovation.

So what is a hostile takeover anyway?

When a bidder makes an offer for another company, it will usually inform the board of the target beforehand. If the board feels that the offer is such that the shareholders will be best served by accepting, it will recommend the offer be accepted by the shareholders. A takeover would be considered “hostile” if (1) the board rejects the offer, but the bidder continues to pursue it, or (2) if the bidder makes the offer without informing the board beforehand

More at
1. Wikipedia
2. HowStuffWorks.com

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