In defending against hostile takeover attempts, a company will include provisions in the employment contracts of key executives that provide them with sizable compensation if the firm is taken over. This is called the ________ strategy.

Question

Quizplus · Accepted Answer

The strategy described in the question is referred to as the "golden parachute" strategy, which involves offering generous compensation packages to key executives in the event of a takeover. This is meant to incentivize them to stay with the company and work against the takeover attempt. The other options listed - shark repellent, white knight, and greenmail - are also defensive strategies used to thwart hostile takeovers, but they do not involve the use of executive compensation packages.

In Defending Against Hostile Takeover Attempts, a Company Will Include