Bankmail

Not to be confused with Blackmail.

Bbankmail' is a tactic used in company mergers or acquisitions, specially in the case of a hostile takeover. It is an agreement between a company and a bank whereby the bank commits to providing financing for a specific takeover bid while agreeing not to finance competing bids from other potential acquirers. [1]

History

Bankmail became popular in the 1980s during the hostile takeover boom.[2] Unlike takeover defenses such as poison pills or greenmail, bankmail operated through acquisition financing: a bank that supported one party to a transaction agreed not to finance a competing bidder.[3]

Notable cases

One of the most well-known examples is the 1989 attempted merger of Time Inc. and Warner Communications. Time allegedly paid a few banks not to help finance a hostile bid while also arranging emergency financing for itself.[4]

In another attempted takeover of Unocal Corp.. by T. Boone Pickens' Mesa Petroleum, Unocal sued Security Pacific National Bank.[5][6]

See also

References

  1. ^ "Bankmail Definition". Nasdaq.com. Nasdaq. Retrieved 22 August 2021.
  2. ^ "Paramount Communications, Inc. v. Time Inc". Justia. Retrieved 7 July 2026.
  3. ^ "The 1980s Takeover Era and Lipton's Stockholder Rights Plan". The Lipton Archive. Retrieved 7 July 2026.
  4. ^ Dunne, John Gregory (23 April 1992). "Your Time Is My Time". The New York Review of Books. Retrieved 7 July 2026.
  5. ^ Rowe, James L. Jr. (13 March 1985). "Unocal Sues Bank for Pickens Deal". The Washington Post. Retrieved 7 July 2026.
  6. ^ "951 F. 2d 1512 - Colan v. Mesa Petroleum Co Colan".
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