Tight credit markets may be crimping traditional M&A, but hostile takeover activity has soared in 2008 as companies with cash are using the current turmoil to expand through acquisition, whether their targets want to or not.
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According to Thomson Reuters data, the number of hostile takeovers has
already hit a record level in the U.S. this year at $211 billion, up 140%
from a year ago. The combination of buyers with strong balance sheets
looking for new ways to grow in a slowing economy, coupled with
falling stock prices and weakened corporate defenses, is creating a
perfect storm for unsolicited offers.
Added to those factors is the telling statistics that hostile bids are
enjoying an unprecedented 28.6% success rate this year, according to
FactSet MergerMetrics. Among the largest unsolicited approaches to get
done in 2008 were deals such as InBev NV's acquisition of
Anheuser-Busch Cos., News Corp.'s winning of Dow Jones & Co.
and Oracle Corp.'s bid for BEA Systems Inc.
- George White
See Reuters story
