abstract:A shareholder rights plan, colloquially known as a "poison pill", is a type of defensive tactic used by a corporation's board of directors against a takeover. In the field of mergers and acquisitions, shareholder rights plans were devised in the early 1980s as a way for directors to prevent takeover bidders from negotiating a price for sale of shares directly with shareholders, and instead forcing the bidder to negotiate with the board.
This morning, Netflix announced that it has adopted a poison pill shareholderrightsplan as a defense against unfriendly attempts to take control of the company.
The addition of Ackman and Roth comes after the retailer enlisted Barclays Capital and Goldman Sachs as advisors and enacted a shareholderrightsplan, following the Pershing and Vornado disclosures in October.