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 ?
poison pills are equally or more effective than standard ATSs, and
While Pulse Data and Neo represent a departure from the poison pill jurisprudence in Canada, they have not displaced the case-specific approach in determining whether to maintain or cease trade a pill and, more generally, in analyzing the duties of the board in the face of an unsolicited bid.
that a poison pill may be allowed to stay in place for an extended
Before presenting formal models, it is worth providing some background on how scholars conceptualize the modern public corporation, as well as how the poison pill and the staggered board work in practice.
Lynch said: "As a matter of principle, I would like to see that any US company that has a poison pill can't bid as easily for a UK company.
The "poison pill" plan will remain in effect for 12 months.
The board told investors that the poison pill move is aimed at preventing any person or group from seizing control over the company by building up a controlling stake in the open market without paying a previously agreed premium.
Shareholder rights plans are a common defensive mechanism that boards take in response to takeover attempts, but Burkle challenged B&N's poison pill in Delaware court on a few of its novelties.
If lawmakers do succeed in crafting a bill that expands educational choice - and is free of "poison pill" provisions - Massachusetts will have taken another step forward, and can lay claim to its rightful share of federal funds.
Indeed, the creativity of deal lawyers and bankers has added such terms as "poison pill," "shark repellent," "Pac-Man defense" and "white squire" to the boardroom lexicon.
A shareholder rights plan, commonly known as a "poison pill," generally makes a takeover more difficult for the buyer.
-- After rebuffing Pier 1 Imports' acquisition offer, Cost Plus has approved the renewal of its preferred shares rights agreement, also known as "a poison pill," through June 30, 2013.