What is a war chest?

The term "war chest" is used to describe a large reserve of assets, especially liquid assets such as cash. Because these assets are in liquid form, they are immediately available if necessary. War chests most often appear in the financial sector, where corporations want to ensure that in the event of an attempt to enemy takeover, they have prepared funds. The nation can also try to build a war chest to finance military actions and other political maneuvers. War leadership costs a large amount of money and, as a result, many nations have historically earmarked funds to manage the eventuality of the conflict. It is also not unusual for the nation to try to find ways to get money quietly when it prepares for conflict. When nations begin to create liquid assets, the observers concerned may indicate that they create a war chest with regard to the enemy intention.

In the corporate world, the company is preparing for an attempt to take over the war chest to take over the biteAlo company trying to command. By providing prepared cash assets to take over, the company can be able to negotiate a better offer than possible, with options per share and less liquid forms of capital. The takeover is very intense events, as companies must obtain a majority holding of shares in another company in order to effectively obtain control, and this may be quite expensive, especially if the receipt attempt is published; This can cause a rush to the company's shares.

Some companies also like to maintain large war chests to protect themselves from taking over. If the company wants to avoid taking over, the war chest funds can use their own stocks, a match with a control from a company that could try to secretly buy most of the share. When companies consider hostile Takeovers tending to try and obtain information about the resources available to their goals; A big war chest could be considered the main discouraging.

ofThis term is generally used in a reference to the main corporations and government, there is no reason why ordinary citizens should not have war chests, although the means that are closed in them can achieve a much smaller total number. Determination of liquid assets for emergencies is cautious financial practice and can ensure that funds are always available, even in the case of a disaster.