Greenmail

GreenmailGraphic: Kate Smith

Like blackmail, greenmail is money that is paid to an entity to make it stop an aggressive behavior.

Definition of greenmail

An antitakeover measure that arises when a large block of stock is held by an unfriendly company that is threatening a hostile takeover. Greenmail is a term that applies to mergers and acquisitions, and refers to the money that is paid by the target company to another company, known as a corporate raider, that has purchased a majority of the target company’s stock. The greenmail payment is made in an attempt to stop the takeover bid. The target company is forced to repurchase the stock at a substantial premium (the greenmail payment) to prevent the takeover. This is also known as a “bon voyage bonus” or a “goodbye kiss.” (via Investopedia)

About David Wild

David Wild (born December 16, 1961) is an American writer and critic in the music and television industries, and a contributing editor at Rolling Stone magazine. His published books include Friends: The Official Companion (1995), Seinfeld: The Totally Unauthorized Tribute (1998), Friends ’til the end (2004), and others. (via Wikipedia)

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