greenmail
greenmail
Pronunciation
The IPA phonetic spelling for "greenmail" is /ˈɡriːnmeɪl/.
green /ɡriːn/:
/ɡ/: voiced velar plosive
/r/: voiced alveolar approximant
/iː/: long close front unrounded vowel
/n/: voiced alveolar nasal
mail /meɪl/:
/m/: voiced bilabial nasal
/eɪ/: diphthong, starting with a mid-front unrounded vowel and ending with a close-front unrounded vowel
/l/: voiced alveolar lateral approximant
Word Form Variations
Noun:
greenmail (singular)
greenmails (plural)
Verb:
greenmail (base form)
greenmails (third-person singular simple present)
greenmailed (simple past, past participle)
greenmailing (present participle)
Definitions, Synonyms and Antonyms
Noun
A hostile takeover defense strategy where a company pays a substantial premium to a corporate raider to repurchase a significant block of its own shares, thereby persuading the raider to abandon the takeover attempt.
Synonyms: corporate ransom, payoff, buyout.
Antonyms: hostile takeover, tender offer, proxy fight.
A type of blackmail or extortion, often involving a perceived threat to a company's reputation or operations, where the extortionist demands payment to cease their actions.
Synonyms: blackmail, extortion, shakedown.
Antonyms: benevolence, goodwill, philanthropy.
Verb
To pay a premium to a corporate raider to buy back a company's shares and prevent a hostile takeover.
Synonyms: buy out, appease, pay off.
Antonyms: resist, fight, challenge.
To threaten a person, company, or institution with negative publicity or disruption unless a sum of money or other concessions are paid.
Synonyms: blackmail, extort, strong-arm.
Antonyms: negotiate, collaborate, cooperate.
Examples of Use
Book: "In the high-stakes world of corporate finance, 'greenmail' has become a common term for when a company pays a raider to abandon a hostile takeover bid" (Lipton, 2012).
Newspaper: A Wall Street Journal article reported on a company's decision to repurchase its shares from a large investor, with analysts debating whether the move constituted a greenmail payment or a legitimate strategic buyback (March 2023).
Online Publication: A post on a popular financial blog explained how activist investors can sometimes exploit the threat of a proxy fight to pressure a company into a greenmail deal (October 2021).
Television Series: In a fictional financial drama, a character accuses a rival of engaging in greenmail, calling it "corporate extortion disguised as a stock transaction."
Public Discourse: During a public meeting, a shareholder expressed concern that the board's proposed stock repurchase plan was a form of greenmail intended to silence an outspoken activist investor.
Legal Journal: A legal scholar's article examined the ethical and legal implications of greenmail, arguing that it can harm long-term shareholders by using company funds to enrich a short-term speculator (February 2024).
10 Famous Quotes Using Greenmail
"Greenmail, in case you're wondering, is when a company pays a raider a premium for his holdings—if he'll go away." (Lee Iacocca)
"The proper word to my mind is blackmail... It is the kind of thing which brings the City into disrepute, euphemistically this practice is described as greenmail." (Justice Peter Smith)
"These environmental challenges are the unions' major tactic to maintain their share of industrial construction—we call it greenmail." (Kevin Dayton, Associated Builders and Contractors of California, June 2009)
"Nearly everyone agrees that greenmail should be stopped." (Anonymous source cited in a 1985 Business Week article)
"A thief who has broken into a bedroom claims his sense of shame had been outraged, and by threatening the occupants with exposure of an immoral act he blackmails them into not bringing charges for burglary." (Karl Kraus, a quote that is sometimes used in an analogy to explain greenmail)
"Greenmail has no redeeming virtues." (Anonymous source cited in a 1985 Fortune article)
"We believe the different reasons for paying greenmail, including those beneficial to shareholders, need to be distinguished." (Jonathan R. Macey and Fred S. McChesney)
"Between April 1983 and April 1984 alone, companies paid over US$4 billion in greenmail." (Corporate Finance Institute)
"Greenmail is not likely to occur in Serbian emerging capital market." (Jovan Crnogorcevic, from a 2012 thesis paper)
"The idea that unions are using California's environmental permitting process as a way to pressure owners to hire union contractors and union labor exclusively should give everyone pause. Environmental regulations exist to ensure development is done responsibly and should not be abused by unions; greenmail is the more common word for this." (Anonymous, June 2009)
Etymology
The word "greenmail" is a blend of two words: "greenback" and "blackmail."
Greenback: This refers to U.S. currency. The term came from the color of the back of the paper money. In the context of "greenmail," it signifies a payment of money.
Blackmail: This refers to the act of extorting money from someone by threatening to reveal something damaging about them. In this case, the "threat" is a hostile takeover, which could be damaging to the company's existing management and business model.
The term first appeared in the early 1980s, during a period of intense corporate raiding and hostile takeovers. The initial meaning was directly tied to this financial practice. A corporate raider would buy a large block of a company's stock and then threaten a takeover. To avoid the takeover, the company's board of directors would pay the raider a premium to buy back those shares. This payment was essentially a form of corporate extortion, hence the combination of "green" (money) and "mail" (from blackmail).
Phrases + Idioms Containing Greenmail
To pay greenmail: This is the most common phrase, simply meaning to make a greenmail payment.
A greenmail payment: Refers to the specific sum of money paid to a corporate raider.
To be a target of greenmail: This describes a company that is being threatened with a hostile takeover in the hope of getting a greenmail payment.
To engage in greenmail: This is used to describe the actions of the corporate raider.
A greenmail artist: A less common, more colloquial term for a corporate raider who specializes in this tactic.
Greenmail tactics: The strategies and actions used by an individual or group to force a company into paying them to stop a hostile takeover.
A greenmail deal: The negotiated agreement to pay a premium for shares to end a takeover attempt.
The greenmail trap: A metaphorical phrase referring to the difficult position a company finds itself in when facing a greenmail threat.
The greenmail premium: The additional cost above market value that a company pays for its own stock to buy off a hostile suitor.
To settle with greenmail: To resolve a hostile takeover situation by making a greenmail payment.
Vocabulary-Based Stories from SEA
Source Information
Definition of greenmail from The Academic Glossary at Self Exploration Academy, a Urikville Press Publication. © All rights reserved.
