What Does Pre-offer Defenses Mean?
Pre-offer defenses are preemptive defense mechanisms used to delay an acquisition in the hope of increasing the purchase price or remaining independent. There are a number of defenses used including:
- Poison pills
- Classified boards
- Golden parachutes
- Supermajority provisions
Divestopedia Explains Pre-offer Defenses
With pre-offer defenses, two main goals are typically desired: either to make a firm's shares look less enticing or to make a firm's governance restrictions too limiting for a potential acquisition company to desire. The overall purpose of each option is to prevent or delay an acquisition.