Hostile takeovers can be a bitter pill to swallow, but Netflix has adopted a “stockholder rights plan” — also known as a “poison pill” — to prevent activist shareholders from taking control. It could be a bitter pill for Carl Icahn, who last week bought a nearly 10 percent stake in the struggling company. Netflix’s response is a technical maneuver that could flood the market with new shares, thus making a takeover prohibitively expensive.
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Netflix Meets Icahn Incursion With Poison Pill Defense
Posted by: Peter Suciu November 5, 2012 02:23 PMHostile takeovers can be a bitter pill to swallow, but Netflix has adopted a “stockholder rights plan” — also known as a “poison pill” — to prevent activist shareholders from taking control. It could be a bitter pill for Carl Icahn, who last week bought a nearly 10 percent stake in the struggling company. Netflix’s response is a technical maneuver that could flood the market with new shares, thus making a takeover prohibitively expensive.