A hostile bid is an offer from a potential buyer to purchase the shares of a publicly traded company against the wishes of the target company's board of directors or management. It is a hostile takeover attempt, since the board or management team of the target company has refused to accept the purchase offer. The bid is typically made directly to shareholders, skipping the board or management entirely in an attempt to obtain a majority stake in the company and gain control of their operations.

Hostile bids are generally found in situations where the acquirer sees potential value in the target company, but management and the board are either not interested in selling, or are asking for too high a price. The potential acquirer may sense an opportunity to take control at a lower cost than current management is offering, and may try to win over individual shareholders with an attractive offer. The hostile bidder may also threaten to disrupt managerial operations in the hope of negotiating a better price.

Proxy battles become a frequent outcome of hostile bids, since the hostile bidder attempts to gain control of the company by replacing the existing management team with its own representatives. In some cases, existing management can make various strategic decisions to protect the company from the hostile bid and try to prevent the takeover. This can involve selling off key assets, increasing the amount of debt on the balance sheet, or even engaging in defensive mergers with other companies.

Hostile bids can be an effective way to gain control of a target company, particularly when management is asking for too high a price. However, the hostile bidder must take into account that engaging in a hostile takeover may not be welcomed by existing shareholders or management, and could backfire, resulting in increased costs of litigation and other associated risks. It is also important to note that many countries impose restrictions and regulations on hostile takeover attempts, making them far more difficult to perform.