BREAKING: Twitter Board is enacting a tactic called a 'Poison | Ryan Fournier
BREAKING: Twitter Board is enacting a tactic called a "Poison Pill"
A poison pill is a defense tactic utilized by a target company to prevent or discourage hostile takeover attempts. Poison pills allow existing shareholders the right to purchase additional shares at a discount, effectively diluting the ownership interest of a new, hostile party. By discouraging a motivated buyer from buying more company stock, a shareholder rights plan is likely to leave a share price lower than it would be otherwise, at least in the short run.
Poison pills can also shield entrenched and underperforming company managers from shareholder efforts to replace them.
