ShmoopTube

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Finance a la shmoop what is a pacman defense?

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[Pacman eating] yeah well wacka wacka to you too...Hostile takeovers are rare in real life not so

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rare in pac-man but when they do happen there exists a whole cadre of strategies

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behind defending them at least from the company's perspective being taken over

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there and pac-man defense is inarguably the best named strategy of all of

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them in essence what happens when we'll say an angry competitor let's call him

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blinky Inc tries to buy an angrier competitor let's call them inky inc.

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well blinky would be buying shares of inky in the open marketplace filing to [Blinky and inky appear]

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go past 15% ownership and eventually own enough shares to elect its own Board of

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Directors and make a takeover happen well in a Pac Man defense as blinky is

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snarfing up shares of inky, inky buys shares of blinky sort of turning the

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tables you know like this and while you're gobbling up that competition and [Pacman gobbling competition]

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don't forget to eat a bunch of cherries or a strawberry every once in a while

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because you know you still need your fruits and veggies

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