M&A
No-Shop Clause
Reviewed by iGaming Times editorial teamLast reviewed 24 September 2026
What is No-Shop Clause?
A provision barring a target from soliciting or negotiating rival offers once an acquisition is signed, subject to a fiduciary carve-out allowing its board to respond to an unsolicited superior proposal.
Key takeaways
- A no-shop clause bars a target from soliciting, negotiating or sharing information with rival bidders once a deal is signed.
- A fiduciary carve-out lets the board engage with an unsolicited superior proposal, usually subject to matching rights and a break fee.
- Caesars Entertainment ran a 45-day go-shop in 2026 before its no-shop began, drawing a higher bid the board declined on deliverability grounds.
Why it matters
A no-shop is what a buyer gets in return for committing to a price. Having signed, it wants certainty that the target will not use the agreement as a stalking horse to run an auction it did not have to pay for. The clause therefore prohibits solicitation, information-sharing and negotiation with anyone else, and requires the target to notify the buyer if an approach arrives.
The fiduciary carve-out is what stops the clause becoming absolute, and it is the part that matters in practice. A board cannot contract away its duty to shareholders, so the agreement allows it to engage with an unsolicited proposal that is, or could reasonably lead to, a superior proposal, usually with matching rights for the incumbent buyer and a break fee if the target ultimately switches. Where a go-shop period exists it sits before the no-shop begins: the target may actively solicit for a defined window, and only then does the restriction bite. Reading the two together tells you how contested a deal really was. Caesars Entertainment ran a 45-day go-shop in 2026, which produced a higher bid the board then declined on deliverability grounds, an outcome the no-shop period made public in the proxy rather than concealing.
The bottom line
The no-shop buys certainty for the buyer; the fiduciary carve-out is the shareholders’ escape hatch. Neither is meaningful without the other.
Sources
- Caesars Entertainment, Inc. Form 8-K (merger agreement with Fertitta Entertainment) - US Securities and Exchange Commission (EDGAR)
- Caesars Entertainment, Inc. Definitive Proxy Statement (DEFM14A), 2026 - US Securities and Exchange Commission (EDGAR)
Frequently asked questions
What is a no-shop clause?
A no-shop clause is a provision in an acquisition agreement that bars the target from soliciting, encouraging or negotiating rival offers, or sharing information with other bidders, once the deal is signed. It usually also requires the target to tell the buyer if an approach arrives. It is what the buyer receives in return for committing to a price.
What is the difference between a no-shop and a go-shop?
A go-shop period lets the target actively solicit alternative bids for a defined window after signing, and the no-shop restriction begins only when that window closes. Caesars Entertainment's 2026 merger agreement, for example, gave it a 45-day go-shop running to 11 July 2026, after which the no-shop applied. Reading the two together shows how contested a deal really was.
Can a board accept a better offer under a no-shop clause?
Yes, within limits. Because a board cannot contract away its duties to shareholders, the agreement includes a fiduciary carve-out allowing it to engage with an unsolicited proposal that is, or could reasonably lead to, a superior proposal. The incumbent buyer typically has matching rights, and the target pays a break fee if it ultimately switches.