Notable Hostile Takeover Cases
Hostile takeovers are a high-stakes event that leaves a lasting mark on the corporate landscape. They involve a company that is buying trying to acquire the target firm against the wishes of the board and management. Hostile takeovers, despite their escalating drama and public nature are not as common as they were in the past.
In the 1980s, there was a total of 160 unassisted hostile takeover bids submitted, and board members feared of “corporate raiders” like Carl Icahn. These events were widely covered, which led to lengthy and mudslinging negotiation.
One notable example is the acquisition of Cadbury in 2009 by Kraft Foods Inc. It was the biggest hostile acquisition in the history of the company and workers in the UK were furious at the possibility of losing their jobs. Cadbury’s management refused the offer as it was an extremely low-ball offer. Kraft offered a sweeter deal and eventually purchased the confectionary giant.
Another noteworthy case is the acquisition by KKR of Airgas in the year 2010. It was a hostile acquisition of an industrial gas supplier and represented one of the largest leveraged buyouts of the past. The media rage grew, and the deal ended up in a long legal dispute.
Elon Musk’s acquisition Twitter in 2022 is an earlier example. The hostile takeover required the use of a poison pill defense and led to tumultuous negotiation and sweeping policy change post-acquisition. This was a case where an acquisition with a strategic plan was able to overcome the hostile takeover battle. It shows how important it is to have a well-planned plan to avoid unwanted offers.
