Definition of Greenmail

Greenmail is the act of a person who buys a necessary/required quantity of share of a company in order to pressurize them for an unfriendly takeover.  Then the threat is used to again pressurized the company to buy back the share but at a much inflated or premium price.


Greenmail is a type of blackmail to a company. The company buys back the share at a much higher price with the settlement that the individual won’t buy the shares again.


The act of greenmail was quite famous back in the 1980s in the US, Where the companies had to pay $4 billion as a ransom for greenmail acts.

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