Poison Pills

“Shareholder rights plans, or poison pills, are widely known as one of the most effective defensive tactics firms can employ when facing unsolicited takeover bids [...]. A typical plan allows existing shareholders to purchase additional shares of the firm at a deep discount when any person crosses some prespecified threshold of ownership. Pills are particularly effective as an anti-takeover device because corporate boards can adopt them swiftly without requiring shareholder approval".

Source: https://law-economic-studies.law.columbia.edu/sites/default/files/content/Eldar%20Kirmse%20Wittry_Rise%20of%20Anti-Activist%20Poison%20Pills_Jan%202023_SSRN.pdf

By: Ofer Eldar, Tanja Kirmse, and Michael D. Wittry, for European Corporate Governance Institute (ECGI)

Rise of Anti-Activist Poison Pills.pdf

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