'White Squires' to the Rescue

A "white squire transaction" is one in which a publicly traded company issues a large block - typically 10%-20% - of its shares to a friendly acquiror, which acts as a long-term strategic or financial investor. The white squire is of less power than a "white knight" - the term em...

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Bibliographic Details
Published in:The Ohio CPA journal 1990-10, Vol.49 (3), p.55
Main Author: Gunning, David
Format: Article
Language:English
Subjects:
Anti takeover strategy
Corporate raiders
Foreign investment
Hostile takeovers
Negotiations
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Summary:A "white squire transaction" is one in which a publicly traded company issues a large block - typically 10%-20% - of its shares to a friendly acquiror, which acts as a long-term strategic or financial investor. The white squire is of less power than a "white knight" - the term employed to describe an acquiror that purchases all of a target company's outstanding equity securities in a friendly transaction. The white squire offers significant, but not total, protection from a hostile raider. Contrasted with a takeover, a white squire transaction is much more related to a joint venture but without the typical co-management component. US business is constantly seeking methods to avoid unwanted takeovers and protect long-term shareholder interests. There exists a tremendous opportunity in American companies to invite foreign - particularly Japanese - companies to enter the US market through white squire transactions.
ISSN:0749-8284