News & Studies

5 Things You Will Learn About Communication in Hostile Takeovers in Just 5 Minutes:

1. How focused internal communication can stabilize your employees and reverse uncertainty.
2. How to convince investors of your long-term strategy and independence.
3. Why consistent public communication is crucial.
4. How leveraging social media can strengthen your position in hostile takeover situations.
5. Which legal communication measures you can implement to clearly and strategically convey defensive measures.

An effective communication strategy is a key instrument in successful defense against hostile takeover attempts. The focus must be on proactive internal and external communications, legal communications, and strategic planning. The following explains how to achieve this:

1. Internal Communication and Strategic Measures

• Employee Retention: Transparent communication with employees creates trust and reduces uncertainty. Provide regular updates on the M&A process and its developments to prevent rumors and maintain workforce stability.
• Crisis Management Teams: Establishing internal task forces enables immediate and coordinated response to new issues throughout the M&A process.
• Leadership Coaching: Executives should be prepared early on for critical conversations and public appearances to strengthen the overall communication effort.
• Scenario Planning: Preparing Q&A documents, press releases, and contingency plans enables quick responses to unexpected situations during the M&A process.

2. External Communication During Mergers and Acquisitions:

• Shareholders and Investors: The focus must be on the articulation of a clear communication of the company’s long-term strategy, the benefits of staying independent, and the intrinsic value of the business. Highlighting financial stability, alternative growth plans, or seeking “White Knights” may be persuasive to investors.
• Public and Media Relations: A consistent messaging thread on behalf of the value and independence of the business can foster support. Good messaging and favorable media coverage end rumour and will be well received by stakeholders.

3. Juristische und regulatorische Kommunikation bei Mergers and Acquisitions

• Compliance: Transparency of cooperation with the regulatory bodies is crucial to avoid legal risks.
• Communicating Strategic Defensive Measures: Defensive measures in the form of “poison pills” – tactics intended to make the company less attractive as a target to a bidder – or structural defenses with the potential to raise the takeover barriers need to be clearly explained and legally warranted.

Conclusion

A successful M&A communication strategy in a hostile takeover scenario requires proactive internal and external communication. While internal efforts focus on reducing employee uncertainty, external communication should stress the value of the company’s independence.

Find out whether your hostile takeover communications strategy is optimized by posing the following questions to yourself:

• Have you assembled a crisis communications team that can act fast in the event of a hostile takeover?
• Do you already have pre-written messages ready for immediate release in the event of a hostile takeover?
• Is there an open shareholders’ communication plan that is based on the company’s long-term strategy and independence?
• Do you have a social media strategy in place to address potential rumors and misinformation effectively?
• Are legal communication protections, such as “poison pills,” well designed and clearly expressed?

Would you like assistance in answering these questions? We would be happy to help you with our expertise gained from over 25 years of investor relations. We support you in optimizing your communication strategy during the M&A process. Contact us using the contact form below or get in touch with Claudius Krause directly. You can find an overview of our services in our M&A fact sheet.