What it is:
A white knight is a company that acquires another company that is trying to avoidby a third party.
How it works (Example):
For example, let's assume that Company XYZ wants to acquire Company ABC. Company ABC feels that Company XYZ is a hostile bidder andruin the company. As a result, Company ABC's directors go on the offensive and tell the shareholders that a to Company XYZ would not be a good thing.
Company 123, which has worked with Company ABC for years and has a good relationship with its board, sees an opportunity to "save" Company ABC from the tense situation and make a lucrative
Why it Matters:
White knights make acquisitions on friendly. White knights are white because they are associated with goodness and virtue.