Examples Of Hostile Takeovers That Were Successful

Examples Of Hostile Takeovers That Were Successful

A hostile takeover is a situation where an acquiring company proceeds to take over the management and control of another company against its management’s wishes. The prevalence of hostile takeovers has drastically reduced from the 90s to the present. There were about 160 hostile takeovers noted in 1980 compared to less than 12 in present-day America. Let us know about “Examples Of Hostile Takeovers That Were Successful”

Examples Of Hostile Takeovers That Were Successful

There are various reasons why hostile takeovers become necessary, the main one being that an acquiring company presented its offer to the management of another company and was rejected. There are many ways that a hostile takeover can take place. While they are mostly not successful due to techniques employed by companies to shield themselves, there have been a few successful ones in history that we will look at in this article.

Oracle And PeopleSoft, 2003:

Oracle engaged in a hostile takeover of the software vendor PeopleSoft in what was referred to as one of the biggest hostile takeovers in the software industry since IBM and Lotus. Oracle placed an unwelcome bid on PeopleSoft days after they announced their intention to acquire J.D Edwards. Oracle placed a tender worth 10.3 billion dollars after a long-drawn-out battle between the two, and the PeopleSoft management accepted the tender.

Kraft Foods And Cadbury, 2009:

In 2009, Kraft Foods offered to purchase Cadbury at 16 billion dollars, a proposal that the CEO of Cadbury rejected and went ahead to create a defence to prevent a takeover. The United Kingdom even got involved citing that the offer undervalued the famous Dairy milk chocolate creator. Almost a year later, Kraft foods made a counter-offer of 19 billion dollars which Cadbury accepted.

InBev And Anheuser-Busch, 2008:

Inbev made an offer to acquire Anheuser-Busch at 46 billion dollars. The proposal was referred to as unwelcome by the latter, and a conflict arose. Inbev threatened to lay off all the board directors of Anheuser-Busch. After a drawn put battle, Inbev made a counter-offer of 52 billion dollars, which the shareholders accepted as a reasonable offer, and the takeover was concluded.

Sanofi-Aventis And Genzyme Corp, 2010:

In 2010, Sanofi took over the operations of American biotech company Genzyme Corp. The Sanofi leadership had approached the CEO of Genzyme Corp for an acquisition deal valued at 69$ per share, a value that Henri Temper, the then CEO of Genzyme, rejected as a low value for their claims.

Sanofi then approached the Genzyme shareholders, pitched the takeover’s value, and made an offer that was difficult to reject, valuing the company at 20.1 billion dollars. Just like that, Genzyme Corp became a subsidiary of Sanofi-Aventis.

IBM And Lotus, 1995:

In 1995, IBM made an offer to acquire Lotus at 60$ per share, a value rejected by Lotus, a then budding computer software company that had created a product called Notes. Seven days later, however, after numerous negotiations, Lotus accepted a counter-offer of 64$ per share. Part of what made the deal acceptable to Lotus was the agreement between both companies to have Lotus operate independently even after the takeover.

What Are Examples Of Takeovers That Later failed?

In 2000, AOL set its sights on the Time Warner Company. This was after it had been acquiring several companies in the previous months. The companies merged their operations and were valued at over 300 billion dollars. The merger, however, was a failure, with AOL unable to increase revenue streams, and the gaping losses saw Time Warner demerge from AOL a year into their partnership.

Which Is The Largest Hostile Takeover Ever Recorded?

That would be Vodafone AirTouch and Mannesmann AG. Vodafone acquired Mannesmann AG in 200 after three months of a drawn-out battle against a hostile takeover. It is said that Vodafone initiated a stream of high severance payments for the management of Mannesmann to sway their vote towards the acquisition.

Vodafone successfully acquired Mannesmann at 190 billion dollars and became one of the largest telecommunications companies in the world, with a market share that totals 360 billion.


Now we have learnt “Examples Of Hostile Takeovers That Were Successful’, Hostile takeovers are not new, and while it may be challenging to execute one successfully, companies proceed to pursue them for various reasons. They can be helpful if, as a company, you are looking to increase your market share, reduce or eradicate competition, or project higher streams of revenue from a potential acquisition. To succeed, however, wisdom and negotiation power are necessary: knowing your target company and understanding how to navigate could be the difference between success and failure.

Frequently Asked Questions:

Are hostile takeovers legal?

Hostile takeovers are legal as it is up to the board of directors or shareholders to accept or reject a potential acquisition offer.

What types of hostile takeovers exist?

Companies can be acquired through a proxy vote, where shareholders are approached with the terms of an offer if the board of directors has rejected it to sway their votes in favour of it. A tender is when an acquiring company makes a bid acceptable to the board, and they accept it.

Examples Of Hostile Takeovers That Were Successful

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