Encyclopedia > Poison pill

  Article Content

Poison pill

Poison pill is a business term referring to a strategy to avoid a hostile takeover bid.

Specifically the target of the takeover will take on large debts in an effort to make the debt load too high to be attractive (the company doing the takeover must pay the debts). Another strategy is to buy a number of smaller companies using a stock swap, which dilutes the value of the companies stock and makes it less attractive. The debts (or companies) can be sold off at a later date when the takeover is no longer a threat.



All Wikipedia text is available under the terms of the GNU Free Documentation License

 
  Search Encyclopedia

Search over one million articles, find something about almost anything!
 
 
  
  Featured Article
Reformed churches

... the Gallic Confession[?] and French Reformed confession of faith, which served as models for the Belgic Confession of Faith[?] (1563). German Reformed ...

 
 
 
This page was created in 26.1 ms