Flip-over

Knowledge Center

What is Flip-over? Meaning.

A Flip-over is an anti-takeover mechanism in which current shareholders of a targeted firm will have the option to purchase discounted stock of the acquiring company after the potential takeover, typically at half price, thereby impairing the acquirer's capital structure and drastically diluting the interest of the acquirer's other shareholders.

The strategy gives a common stock dividend in the form of rights to acquire the firm's common stock or preferred stock above market value. Following a takeover, the rights would "flip over" and allow current shareholders to purchase the unfriendly competitor's shares at a discount. If this tool is exercised, the number of shares held by the unfriendly competitors will realize dilution and price devaluation.

Forum Forum about Flip-over. Below you can ask a question about this topic, share your experiences, report a new development, or explain something. Start a new topic about Flip-over Share your knowledge here (or ask a question)

Information Sources Various sources of information regarding Flip-over. Here you will find powerpoints, videos, news, etc. to use in your own lectures and workshops.

Research Links Jump to further research sources regarding Flip-over. News Videos Presentations   Books Academic More

Compare with: Flip-in  |  Anti Hostile Takeover Mechanisms  |  Targeted Repurchase

Return to Management Hub: Ethics & Responsibility  |  Finance & Investing  |  Strategy & Innovation

More on Management  |  Return to Management Dictionary

This ends our Flip-over summary and forum.