Definition of war chest

fund of liquid assets (cash) set aside by a corporation to pay for a takeover or to defend against a takeover. Traders will say that a company has a war chest that it plans to use to take over another company. Or traders might say that a particular company will be difficult to take over because it has a large war chest that it can use to defend itself by buying back its stock, making an acquisition of its own, paying for legal fees to mount defenses, or taking other defensive measures.