Entry in progress—B.P.
What Does Sleeping Beauty Mean?
A company that is prime for takeover but has not been approached by an acquiring company.
Investopedia explains Sleeping Beauty
A company may be considered a sleeping beauty because it has large cash reserves, undervalued real estate, or huge potential.
The Free Dictionary
Often used in risk arbitrage. Potential takeover target that has not yet been approached by an acquirer. Such a company usually has particularly attractive features, such as a large amount of cash, or undervalued real estate or other assets.
A firm with valuable assets not effectively used by its management. Such a firm has high profit potential and value and is therefore a prime candidate for takeover.
Firm ripe for takeover but not known well enough to arouse a suitor’s interest.
Free Merriam-Webster Dictionary
Sleeping Beauty noun
Definition of SLEEPING BEAUTY
: a princess of a fairy tale who is wakened from an enchanted sleep by the kiss of a prince
First Known Use of SLEEPING BEAUTY
25 October 1977, New York (NY) Times, “So Sleeping Beauty Was Rescued By White Knight From Bear Hug” by Robert J. Cole, pg. 73:
In the melodramatic idiom of Wall Street, the United Technologies Corporation tried a few months ago to clamp a bear hug around the Babcock & Wilcox Company, but J. Ray McDermott & Company, after initial resistance, eventually came forward as the White Knight and walked off with Sleeping Beauty.
Sleeping beauties, as the report explains, are companies that are “ripe for takeovers.” They are vulnerable, it adds, because they have low price-earnings ratios, book value that is higher than the market price for the stock, a limited number of shares, undervalued assets, lots of cash or equivalents, unused borrowing capacity and limited control by insiders.
New York City • Banking/Finance/Insurance • (0) Comments • Friday, February 11, 2011 • Permalink