A hostile acquisition, or hostile takeover, refers to the acquisition of a company other than through the purchase of the company directly. A hostile acquisition may be an important corporate strategy to achieve business goals and growth. For an acquiring company, a hostile takeover can be a challenging process. The boards of directors of many corporations commonly have mechanisms in place to attempt to prevent hostile takeovers and a targeted company may have a number of potential defenses available to it to attempt to deny a hostile acquisition.
Mergers and acquisitions can be a big step for any business. The national banking industry, for example, has seen a wave of mergers due to increased costs and competition. The consolidation activity throughout the banking industry has also had an impact on the banking industry in Louisiana. Nine banks in Louisiana have either agreed to or completed acquisitions over the past two years. The smaller banks in Louisiana that will be acquired will likely be purchased by institutions headquartered in Baton Rouge and other major Louisiana cities.
Growth opportunities can be exciting, yet also complex at times, which is why understanding the process of buying a company can be important. A bank that began in Baton Rouge recently went public; the initial public offering grossed $46 million and included the issuance of 3.3 million shares. The bank began as a single branch and now has 11 locations in southern Louisiana; the company plans to open two more branches over the next two years. The corporate strategy that the company is employing moving forward is to grow in existing markets, but also to grow through the acquisition of small banks.
A merger can be a serious consideration for any company which is why legal tools and resources are available to assist and guide merging parties through the process.
Acquiring new businesses is a positive step for most companies which is why it is important that acquisitions be executed properly.
Complex business transactions require careful consideration and special attention in order to avoid unwanted results. Poorly negotiated Mergers, for example, may lead to business litigation, wasted time and money, and a situation where neither party is happy with the resolution. In some instances, the merger may be disallowed from occurring. Therefore, when one considers acquiring a new business or buying a company, he should consult with an experienced business transaction attorney.
While there are many different types of businesses in Baton Rouge, Louisiana, a primary goal of each of them is to be successful. Companies have different strategies for achieving this success. Mergers and acquisitions, however, are a common business strategy used.
Mergers and acquisitions are undoubtedly complicated ordeals, and the recent news on Louisiana Farm Bureau Mutual Insurance Co.'s merger with Arkansas Farm Bureau, Colorado Farm Bureau Mutual Insurance Co. and the South Carolina Farm Bureau Mutual Insurance Co. only provides more proof. While the goal of the merger is to create a larger and more flexible company, there are some bumps along the way: the Arkansas Farm Bureau's financial strength rating has been downgraded by a credit ratings agency. As for the Louisiana Farm Bureau, its rating remained the same.