poison pill


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Related to poison pill: dead hand poison pill, Poison Put

Poison pill

Anti-takeover device that gives a prospective acquiree's shareholders the right to buy shares of the firm or shares of anyone who acquires the firm at a deep discount to their fair market value. Named after the cyanide pill that secret government agents are said to be instructed to swallow if capture is imminent.

Poison Pill

An antitakeover measure stipulating that shareholders on the receiving end of a hostile takeover may buy shares in their own company at a price below fair market value. Once the acquisition is complete, the provision allows these same shareholders to buy more shares in the new company for below market value. This forces shareholders in the acquiring company to suffer a devaluation and dilution of their own shares. This is done to discourage hostile takeovers among the shareholders of the acquiring companies. It is important to note that a poison pill need not use both of these tactics; sometimes it utilizes only one or the other.

poison pill

An antitakeover tactic in which warrants are issued to a firm's stockholders, giving them the right to purchase shares of the firm's stock at a bargain price in the event that a suitor hostile to management acquires a stipulated percentage of the firm's stock. The poison pill is intended to make the takeover so expensive that any attempt to take control will be abandoned. See also flip-over pill, Jonestown defense, macaroni defense, suicide pill.

poison pill

see TAKEOVER BID.
Point elasticityclick for a larger image
Fig. 143 Point elasticity.

poison pill

see TAKEOVER BID.
References in periodicals archive ?
The 2004 poison pill plan was to thwart John Malone and Liberty Media Corp.
38) The foundation of Canadian poison pill jurisprudence was set by the
If this proposal is approved, shareholders will have the right to vote on subsequent poison pill provisions for the next 20 years, a major outcome that assures investor participation on a key aspect of News Corp's corporate strategy.
A letter attached to the SEC filing requested that Tweeter's board of directors submit to its shareholders during the retailer's 2006 annual meeting a proposal to terminate its poison pill plan and eliminate a provision of its "certificate of incorporation that provides for a staggered board of directors.
Poison Pill Securities: Stockholder Wealth, Profitability, and Ownership Structure.
He is proposing a bylaw that would disqualify board members for an additional term if they failed to approve elimination of poison pill rights within 180 days after the passage of a stockholder resolution in favor of such action.
Shareholders approved the proposal ending the poison pill for the second year in succession, this time by a margin of one per cent.
His November 1998 announcement of a "Shareholder Franchise Bylaw" which would forbid a company from renewing its poison pill without shareholder approval, served as a model for other shareholders to emulate in the 1999 proxy season.
3, 1987), the acquiring company in a proposed reverse triangular A-type merger was to issue its stock and poison pill rights that, in the absence of certain events, would be transferred "with and only with" the underlying shares.
adopts a plan to provide its shareholders with poison pill rights--including rights to purchase preferred stock following a triggering event.
The author asserts that, on the contrary, the Canadian approach to poison pill regulation is superior to the American regulatory regime, because it emphasizes shareholder choice while providing management with a (time-limited) opportunity to attract superior offers.
A group of international institutional investors has brought suit against News Corporation to compel the media conglomerate to abide by a promise it made to shareholders less than a year ago that it would not extend poison pill provisions beyond 12 months without express shareholder approval.