What Does Beachhead Acquisition Mean?
A beachhead acquisition occurs when a company acquires a business in another geographic market to establish an entry point for future growth. In the public markets, a beachhead acquistion is the first offensive in a hostile takeover bid, whereby the acquirers slowly acquire a small minority interest in the target through the open market with the hopes of going undetected.
Divestopedia Explains Beachhead Acquisition
Beachhead acquisitions provide a good strategy for businesses looking to grow into other markets without taking on the significant risk of a larger acquisition. A beachhead acquisition allows the acquiring company to test the market and gauge acceptance of its product or service. It also allows the acquirer time to make adjustments to the business' offering in that market, if needed, or reassess the appetite for further expansion all together.