Williams Act

Categories: Regulations, Banking

Well, it’s 28 grand slam singles titles. 26 in doubles. 8 Olympic gold medals. A successful designer clothing company and an interior design firm.

Ok, ok...the Williams Act is actually about making acquisitions or takeovers...fair and square. Ya know. Like a tennis court.

Before 1968, when the Williams Act 1.0 was enacted, MegaGlop Gargantuan Strollers could launch a takeover bid for MicroCorp Shakers, Rattlers, n’ Hum, to make a vertically integrated near-monopoly in baby hardware.

The bid could have come in on a Thursday, giving shareholders 48 hours to respond with, say, a 20% premium over the current share price. Take it by noon Monday, or the deal's off the table.

Shareholders would then have to quickly scramble to figure out whether this was a fair price, a steal, or something else done just to disrupt the market. A bunch of companies were “stolen” this way, with boards having to scramble and often ending up with less than an optimal deal for its shareholders.

So the Williams Act came along and required there be a whole range of filings and disclosures whenever a public takeover was announced, like the price, the terms, the mix of stock and cash, what the newly composed company would look like, etc. It also required there be at least 5 days from when the initial takeover was announced to there being any kind of definitive agreement. And then, quickly, investors realized that five days wasn’t long enough, so less than a decade later (yeah, things move slowly in financial regulatory worlds), the Williams Act pause button was extended to 20 days. And that’s where things stand today.

So yeah, the Williams Act ensures fairness, which cannot be said for the take-no-prisoners Williams sisters. Those two do not know the meaning of the word "mercy."

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Finance: What is the Williams Act?5 Views

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finance a la shmoop what is the Williams Act

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well it's 28 Grand Slam singles titles 26 in doubles eight Olympic gold medals [William's sisters career stats appear]

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a successful designer clothing company and an interior design firm yeah like

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you really thought shmoop wouldn't go there for this one come on the Williams

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Act the financial one is actually about making acquisitions or takeovers fair

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and square you know like a tennis court before 1968 when the Williams Act 1.0 [People playing tennis]

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was enacted mega glopped gargantuan strollers could launch a takeover bid

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for micro Corp shakers Rattlers and Hum to make a vertically integrated

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near-monopoly in baby hardware the bid could have come in on a Thursday giving [Bid appears on calendar]

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shareholders 48 hours to respond with say a 20% premium over the current share

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price take it by noon Monday or leave it in the deal's off the table shareholders

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would then have to quickly scramble to figure out this was no is this a fair [Woman scrambling away]

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deal a steal or something else done just to disrupt the market well a bunch of

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companies were quote stolen unquote this way with boards having to scramble and [Robber running away from police]

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often ending up with less than optimal or full value that they were supposed to

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get for their shareholders who they represent so the Williams Act came along

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and required there to be a whole range of filings and disclosures whenever a

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public takeover was announced like the price the terms the mix of stock and

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cash what the newly composed company would look like it's out its out cetera

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and it also required that there be at least five days from when the initial [Five days on calendar highlighted]

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takeover was announced to there being any kind of definitive agreement and

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then quickly investors realized that five days wasn't long enough so less

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than a decade later yeah things move slowly in a financial regulatory world [Cash falling]

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the Williams Act pause button was extended to 20 days and that's where

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things stand today so yeah the Williams Act ensures [Williams act stamped fairness]

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fairness or at least it tries to and that fairness you know which cannot be

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said for the taking no prisoners Williams sisters those two do not know

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the meaning of mercy [Tennis ball hits girl on the head]

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