Thursday, March 26, 2020

Poison pills may be worth considering in current market conditions, according to Kirkland & Ellis experts

By David B. Feirstein, Sarkis Jebejian, Shaun J. Mathew, Dean S. Shulman, Daniel E. Wolf, and Sara B. Zablotney, Kirkland & Ellis, LLP

A team of Kirkland & Ellis attorneys discusses the value of poison pills at a time when the unprecedented market disruption caused by the coronavirus pandemic has driven stock prices down precipitously. In their view, all companies should be paying closer attention to the composition of their shareholder base and trading activity and be ready to act quickly against opportunistic stock accumulations. They note that shareholder rights plans can guard against a takeover bid, creeping control or an activist campaign, as well as protect a company’s valuable net operating loss carryforwards.

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