Possible defence tactics and themes

Work up defence tactics and themes with the company’s advisers. These will require defence team/board sign-off and speed will be critical. Some possible tactics and themes are set out below:

  • make the approach public – this is likely to result in an immediate share price rise, but would put your company "in play’"

  • value defence – ie demonstrate how the approach merely offers some cash today versus your company’s ability to deliver more tomorrow

  • split-up option(s). In essence, this is a variation of a value defence. You will need to consider:
    • the potential timetables involved in implementing any split-up options
    • exactly how any cash can be returned to shareholders following any split-up
  • are there any "white knights" in the market you can approach?
  • are there any obvious regulatory defences available, including:
    • potential anti-trust issues raised by the bidder’s proposed offer
    • potential political or regulatory dimensions that can be used to the company’s advantage
  • Bidder attack:
    • with your advisers, consider any possible conflict of interest for the bidder’s investment bank
    • in what way might the bidder’s financial position and/or credibility of its value assumptions be attacked?
    • what negative PR angles can be explored and exploited?