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Simple English definitions for legal terms
friendly suitor
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A quick definition of friendly suitor:
A friendly suitor, also known as a white knight, is someone or a company that helps protect another company from being taken over by an unfriendly corporation. They do this by either buying a controlling interest in the target company or by making a competing offer. This is different from a corporate raider who tries to take over a company aggressively.
A more thorough explanation:
Definition: A friendly suitor is a person or corporation that rescues a company from an unfriendly corporate takeover. This is done by acquiring a controlling interest in the target corporation or by making a competing tender offer. It is also known as a white knight.
Example: Company A is being targeted by Company B for a hostile takeover. However, Company C steps in and offers to acquire Company A instead, saving it from being taken over by Company B. Company C is the friendly suitor or white knight in this scenario.
Explanation: The example illustrates how a friendly suitor can save a company from being taken over by an unfriendly corporate raider. In this case, Company C is the friendly suitor that rescues Company A from being taken over by Company B. This can happen when the friendly suitor sees potential in the target company and wants to acquire it for strategic reasons, rather than just for financial gain.