greenmail: meaning, definition, pronunciation and examples
C2Formal, Technical, Financial Journalism
Quick answer
What does “greenmail” mean?
A financial practice where a corporate raider buys enough shares in a company to threaten a hostile takeover, thereby pressuring the company to buy those shares back at a premium to avoid the takeover.
Audio
Pronunciation
Definition
Meaning and Definition
A financial practice where a corporate raider buys enough shares in a company to threaten a hostile takeover, thereby pressuring the company to buy those shares back at a premium to avoid the takeover.
The process of profiting from the threat of a takeover without actually carrying it out, often viewed as a form of financial extortion. It can also refer to any form of environmental or ecological extortion, but this is far less common.
Dialectal Variation
British vs American Usage
Differences
The term is used identically in both major varieties. It originated in American corporate finance and spread globally.
Connotations
Universally negative, implying exploitation and financial opportunism. No regional difference in connotation.
Frequency
Slightly higher frequency in US English due to its origins and the larger volume of financial reporting, but it is a standard term in UK financial discourse.
Grammar
How to Use “greenmail” in a Sentence
[Investor/Company] greenmailed [Target Company][Target Company] paid greenmail to [Investor][Target Company] was a victim of greenmailVocabulary
Collocations
Examples
Examples of “greenmail” in a Sentence
verb
British English
- The hedge fund was accused of attempting to greenmail the retail conglomerate.
- They greenmailed the board into buying back their shares at a 30% premium.
American English
- The activist investor greenmailed the tech firm last quarter.
- Laws were passed to make it harder to greenmail a company.
Usage
Meaning in Context
Business
Primary context. Refers to a specific, controversial tactic in mergers and acquisitions.
Academic
Used in finance, economics, and business law papers discussing corporate governance and market regulation.
Everyday
Extremely rare. Would only be used by someone discussing high finance.
Technical
Core term in corporate finance and securities law.
Vocabulary
Synonyms of “greenmail”
Strong
Neutral
Weak
Vocabulary
Antonyms of “greenmail”
Watch out
Common Mistakes When Using “greenmail”
- Using it to mean 'spam email about the environment'.
- Confusing it with 'greenwashing'.
- Using it as a general term for any unethical profit.
FAQ
Frequently Asked Questions
It is not inherently illegal, but it is heavily regulated and restricted in many jurisdictions (like the USA with Internal Revenue Code section 5881) because it is seen as exploitative and damaging to other shareholders.
Blackmail is a general crime involving threats to reveal damaging information. Greenmail is a specific financial practice where the threat is a hostile corporate takeover, and the demanded payment is a premium on share repurchase.
Yes, it can. For example: 'The corporation was greenmailed by a group of investors.'
It originated in American financial circles in the 1980s during a wave of hostile takeovers. It is a portmanteau of 'green' (referring to US dollar bills) and 'blackmail'.
A financial practice where a corporate raider buys enough shares in a company to threaten a hostile takeover, thereby pressuring the company to buy those shares back at a premium to avoid the takeover.
Greenmail is usually formal, technical, financial journalism in register.
Greenmail: in British English it is pronounced /ˈɡriːn.meɪl/, and in American English it is pronounced /ˈɡrinˌmeɪl/. Tap the audio buttons above to hear it.
Phrases
Idioms & Phrases
- “to pay greenmail”
Learning
Memory Aids
Mnemonic
Think of 'green' for money and 'mail' for blackmail: it's financial blackmail.
Conceptual Metaphor
FINANCIAL PRESSURE IS BLACKMAIL (a specific, illegal/immoral act).
Practice
Quiz
What is the primary meaning of 'greenmail'?