greenmail

American  

[green-meyl] / ˈgrinˌmeɪl /

noun

Stock Exchange.

1. the practice of buying a large block of a company's stock in order to force a rise in stock prices or an offer by the company to repurchase that block of stock at an inflated price to thwart a possible takeover bid.

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greenmail British  

/ ˈɡriːnˌmeɪl /

noun

1. (esp in the US) the practice of a company buying sufficient shares in another company to threaten takeover and making a quick profit as a result of the threatened company buying back its shares at a higher price

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Other Word Forms

Derived Forms

• greenmailer
  noun

Etymology

Origin of greenmail

green (in sense “money”) + (black)mail

Example Sentences

Fiss said that companies often try to make corporate raiders go away quietly by paying a premium for the shares they acquired, a practice known as greenmail.

From Los Angeles Times • Apr. 19, 2022

Maybe the evidence was weak, and GE paid the equivalent of greenmail just to make the SEC go away.

From BusinessWeek • Feb. 10, 2011

Investors branded the payoff as a clear case of greenmail, since Gillette agreed to buy back Perelman's 13.9% stake in the company at a premium price that was unavailable to other shareholders.

From Time Magazine Archive

Such buyouts at a premium not available to other shareholders are known as greenmail.

From Time Magazine Archive

Opponents also want an end to greenmail, the practice by which a raider launches a fight for corporate control and then agrees to be bought out for a premium.

From Time Magazine Archive