A white squire is an investor or company that takes a stake in a company to prevent a hostile takeover. A hostile takeover is when a business entity threatens or takes control of an already existing company without the prior consent or agreement of the controlling ownership group. To prevent this from happening, a potential hostile bidder will often enlist a white squire to purchase a large portion of the company's stock, just enough to make sure that the takeover fails.

Unlike a white knight, who purchases the entire company in order to block a hostile takeover, a white squire only purchases a partial stake, usually the largest portion, in order to prevent a hostile bidder from having a controlling interest in the company.

White squires are usually rewarded for their efforts with incentives. These incentives come in the form of discounted shares of the company's stock, or hefty dividends in exchange for their investment. Also, any white squire with significant amount of shares has no legal obligation to any other shareholders as they only purchase a percentage of the stock. So, they are not liable if the takeover fails or the company goes bankrupt.

White Squires are often investment firms or companies with deep enough pockets to make the investment into a targeted company. They add a layer of safety and protection to already vulnerable companies and act as the first line of defense when a hostile takeover is underway. Furthermore, in some cases, the white squire can even be used to facilitate a friendly takeover, allowing two companies to combine forces in order to gain new competitive advantages in the marketplace.

In summary, a white squire is an investor or company that takes a stake in a company to prevent a hostile takeover. A white squire only purchases a partial stake, unlike an white knight that purchases the entire company. By providing incentives such as discounted shares or hefty dividends, white squires can use their financial clout to prevent hostile takeovers and protect companies from unwanted interference.