{"id":432780,"date":"2022-04-16T12:11:20","date_gmt":"2022-04-16T09:11:20","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/what-twitters-poison-pill-is-supposed-to-do\/"},"modified":"2022-04-16T12:11:20","modified_gmt":"2022-04-16T09:11:20","slug":"what-twitters-poison-pill-is-supposed-to-do","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/what-twitters-poison-pill-is-supposed-to-do\/","title":{"rendered":"#What Twitter&#8217;s &#8216;poison pill&#8217; is supposed to do"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_89 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6af681d7b1485\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6af681d7b1485\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-1'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/what-twitters-poison-pill-is-supposed-to-do\/#%E2%80%9CWhat_Twitters_%E2%80%98poison_pill_is_supposed_to_do%E2%80%9D\" >&#8220;What Twitter&#8217;s &#8216;poison pill&#8217; is supposed to do&#8221;<\/a><\/li><\/ul><\/nav><\/div>\n<h1><span class=\"ez-toc-section\" id=\"%E2%80%9CWhat_Twitters_%E2%80%98poison_pill_is_supposed_to_do%E2%80%9D\"><\/span>&#8220;What Twitter&#8217;s &#8216;poison pill&#8217; is supposed to do&#8221;<span class=\"ez-toc-section-end\"><\/span><\/h1>\n<div>\n<div class=\"article-gallery lightGallery\">\n<div data-thumb=\"https:\/\/scx1.b-cdn.net\/csz\/news\/tmb\/2022\/explainer-what-twitter.jpg\" data-src=\"https:\/\/scx2.b-cdn.net\/gfx\/news\/hires\/2022\/explainer-what-twitter.jpg\" data-sub-html=\"The Twitter icon is displayed on a mobile phone in Philadelphia on April 26, 2017. Twitter said in a statement Friday, April 15, 2022, that its board of directors has unanimously adopted a \u201cpoison pill\u201d defense in response to Tesla CEO Elon Musk\u2019s proposal to buy the company and take it private. Credit: AP Photo\/Matt Rourke, File\">\n<figure class=\"article-img\">\n            <img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/scx1.b-cdn.net\/csz\/news\/800a\/2022\/explainer-what-twitter.jpg\" alt=\"EXPLAINER: What Twitter's 'poison pill' is supposed to do\" title=\"The Twitter icon is displayed on a mobile phone in Philadelphia on April 26, 2017. Twitter said in a statement Friday, April 15, 2022, that its board of directors has unanimously adopted a \u201cpoison pill\u201d defense in response to Tesla CEO Elon Musk\u2019s proposal to buy the company and take it private. Credit: AP Photo\/Matt Rourke, File\" width=\"800\" height=\"530\"\/><figcaption class=\"text-darken text-low-up text-truncate-js text-truncate mt-3\">\n                The <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/social-mediaa\/\" data-internallinksmanager029f6b8e52c=\"1\" title=\"Social Media\" target=\"_blank\" rel=\"noopener\">Twitter<\/a> icon is displayed on a mobile phone in Philadelphia on April 26, 2017. Twitter said in a statement Friday, April 15, 2022, that its board of directors has unanimously adopted a \u201cpoison pill\u201d defense in response to Tesla CEO Elon Musk\u2019s proposal to buy the company and take it private. Credit: AP Photo\/Matt Rourke, File<br \/>\n            <\/figcaption><\/figure>\n<\/p><\/div>\n<\/div>\n<p>Twitter is trying to thwart billionaire Elon Musk&#8217;s takeover attempt with a &#8220;poison pill&#8221; \u2014a financial device that companies have been wielding against unwelcome suitors for decades.<\/p>\n<p>                                                                                WHAT ARE POISON PILLS SUPPOSED TO DO?<\/p>\n<p>The ingredients of each poison pill vary, but they&#8217;re all designed to give corporate boards an option to flood the market with so much newly created stock that a takeover becomes prohibitively expensive. The strategy was popularized back in the 1980s when publicly held companies were being stalked by corporate raiders such as Carl Icahn\u2014now more frequently described as &#8220;activist investors.&#8221;<\/p>\n<p>Twitter didn&#8217;t disclose the details of its poison pill Friday, but said it would provide more information in a forthcoming filing with the Securities and Exchange Commission, which the company delayed because public markets were closed Friday.<\/p>\n<p>The San Francisco company&#8217;s plan will be triggered if a shareholder accumulates a stake of 15% or more. Musk, best known as CEO of electric car maker Tesla, currently holds a roughly 9% stake.<\/p>\n<p>CAN A POISON PILL BE A NEGOTIATING PLOY?<\/p>\n<p>Although they are supposed to help prevent an unsolicited takeover, poison pills also often open the door to further negotiations that can force a bidder to sweeten the deal. If a higher price makes sense to the board, a poison pill can simply be cast aside along with the acrimony it provoked, clearing the way for a sale to completed.<\/p>\n<p>True to form, Twitter left its door open by emphasizing that its poison pill won&#8217;t prevent its board from &#8220;engaging with parties or accepting an acquisition proposal&#8221; at a higher price.<\/p>\n<p>Adopting a poison pill also frequently results in lawsuits alleging that a corporate board and management team is using the tactic to keep their jobs against the best interests of shareholders. These complaints are sometimes filed by shareholders who think a takeover offer is fair and want to cash out at that price or by the bidder vying to make the purchase.<\/p>\n<div class=\"article-gallery lightGallery\">\n<div data-thumb=\"https:\/\/scx1.b-cdn.net\/csz\/news\/tmb\/2022\/explainer-what-twitter-1.jpg\" data-src=\"https:\/\/scx2.b-cdn.net\/gfx\/news\/hires\/2022\/explainer-what-twitter-1.jpg\" data-sub-html=\"Elon Musk, Tesla CEO, attends the opening of the Tesla factory Berlin Brandenburg in Gruenheide, Germany, March 22, 2022. Twitter said in a statement Friday, April 15, 2022, that its board of directors has unanimously adopted a \u201cpoison pill\u201d defense in response to Tesla CEO Elon Musk\u2019s proposal to buy the company and take it private. Credit: Patrick Pleul\/Pool Photo via AP, File\">\n<figure class=\"article-img text-center\">\n            <img decoding=\"async\" src=\"https:\/\/scx1.b-cdn.net\/csz\/news\/800a\/2022\/explainer-what-twitter-1.jpg\" alt=\"EXPLAINER: What Twitter's 'poison pill' is supposed to do\"\/><figcaption class=\"text-left text-darken text-truncate text-low-up mt-3\">\n                Elon Musk, Tesla CEO, attends the opening of the Tesla factory Berlin Brandenburg in Gruenheide, Germany, March 22, 2022. Twitter said in a statement Friday, April 15, 2022, that its board of directors has unanimously adopted a \u201cpoison pill\u201d defense in response to Tesla CEO Elon Musk\u2019s proposal to buy the company and take it private. Credit: Patrick Pleul\/Pool Photo via AP, File<br \/>\n            <\/figcaption><\/figure>\n<\/p><\/div>\n<\/div>\n<p>HOW DID ELON MUSK REACT TO TWITTER&#8217;S ANNOUNCEMENT?<\/p>\n<p>Musk, a prolific tweeter with 82 million followers on Twitter, had no immediate reaction to the company&#8217;s poison pill. But on Thursday he indicated he was ready to wage a legal battle.<br \/>\n                                            <!-- Google middle Adsense block --><\/p>\n<p>&#8220;If the current Twitter board takes actions contrary to shareholder interests, they would be breaching their fiduciary duty,&#8221; Musk <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/elonmusk\/status\/1514718700674306052?s=20&amp;t=gAJpozh0qrV7OjMeEaXRsg\">tweeted. <\/a> &#8220;The liability they would thereby assume would be titanic in scale.&#8221;<\/p>\n<p>Musk has publicly said that its $43 billion bid is his best and final offer for Twitter, but other corporate suitors have made similar statements before ultimately upping the ante. With an estimated fortune of $265 billion, Musk would seem to have deep enough pockets to raise his offer, although he is still working out how to finance the proposed purchase.<\/p>\n<p>HOW HAS THIS DEFENSE WORKED IN THE PAST?<\/p>\n<p>Takeover tussles often dissolve into <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/game\/\" data-internallinksmanager029f6b8e52c=\"7\" title=\"Game\" target=\"_blank\" rel=\"noopener\">game<\/a>smanship that include poison pills and other maneuvers designed to make a buyout more difficult. That&#8217;s what h<a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>ened in one of the biggest and most drawn out takeover dances in Silicon Valley history..<\/p>\n<p>After business software maker Oracle made an unsolicited $5.1 billion offer for its smaller rival PeopleSoft in June 2003, the two companies spent the next 18 months fighting with each other.<\/p>\n<p>As part of its defense, PeopleSoft not only adopted a poison pill that authorized the board to flood the market with more shares, it also created what it called a &#8220;customer assurance program.&#8221; That plan promised to pay customers five times the cost of their software licenses if PeopleSoft was sold within the next two years, creating an estimated liability of up to $800 million for an acquiring company.<\/p>\n<p>PeopleSoft also got another helping hand when the U.S. Department of Justice filed an antitrust lawsuit seek to block a takeover, although a judge ruled in Oracle&#8217;s favor.<\/p>\n<p>Even though the company ended up selling to Oracle, PeopleSoft&#8217;s defense strategy paid off for its shareholders. Oracle&#8217;s final purchase price was $11.1 billion\u2014more than twice its original bid.\n                                                                                                                        <\/p>\n<hr\/>\n<div class=\"article-main__explore my-4 d-print-none\">\n<p>                                            Twitter adopts &#8216;poison pill&#8217; defense against Musk buyout bid\n                                        <\/p><\/div>\n<hr class=\"mb-4\"\/>\n<p class=\"article-main__note mt-4\">\n                                                \u00a9 2022 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.<\/p>\n<p>                                        <!-- print only --><\/p>\n<div class=\"d-none d-print-block\">\n<p>                                                 <strong>Citation<\/strong>:<br \/>\n                                                 EXPLAINER: What Twitter&#8217;s &#8216;poison pill&#8217; is supposed to do (2022, April 16)<br \/>\n                                                 retrieved 16 April 2022<br \/>\n                                                 from https:\/\/techxplore.com\/<a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">news<\/a>\/2022-04-twitter-poison-pill.html<\/p>\n<p>                                            This document is subject to copyright. Apart from any fair dealing for the purpose of private study or research, no<br \/>\n                                            part may be reproduced without the written permission. The content is provided for information purposes only.<\/p><\/div>\n<\/p><\/div>\n<p><script async src=\"\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script><script id=\"facebook-jssdk\" async=\"\" src=\"https:\/\/connect.facebook.net\/en_US\/sdk.js\"><\/script><\/p>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more Like this articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/science\/\" target=\"_blank\" rel=\"noopener\">Science category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/techxplore.com\/news\/2022-04-twitter-poison-pill.html\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;What Twitter&#8217;s &#8216;poison pill&#8217; is supposed to do&#8221; The Twitter icon is displayed on a mobile phone in Philadelphia on April 26, 2017. Twitter said in a statement Friday, April 15, 2022, that its board of directors has unanimously adopted a \u201cpoison pill\u201d defense in response to Tesla CEO Elon Musk\u2019s proposal to buy the&#8230;<\/p>\n","protected":false},"author":1,"featured_media":432781,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/scx2.b-cdn.net\/gfx\/news\/hires\/2022\/explainer-what-twitter.jpg","fifu_image_alt":"","footnotes":""},"categories":[16],"tags":[],"class_list":["post-432780","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-sciencee"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/432780","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=432780"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/432780\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/432781"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=432780"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=432780"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=432780"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}