Definition of 'Stalking-Horse Bid'
The stalking-horse bid process can be beneficial for both the target company and the stalking-horse bidder. The target company can get a higher price for its shares than it would if it were simply put up for auction. The stalking-horse bidder can also benefit by getting a discount on the target company's shares, as it is not the only bidder in the process.
However, the stalking-horse bid process can also be risky for both the target company and the stalking-horse bidder. The target company may not get the price it wants for its shares, and the stalking-horse bidder may not be able to complete the acquisition.
Before entering into a stalking-horse bid, it is important for both the target company and the stalking-horse bidder to carefully consider the risks and benefits involved.
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