NEW: Wilmer Hale provides an overview of the purpose and advantages of Net Operating Loss stockholder rights plans in COVID-19: Renewed Interest by Public Companies in NOL Rights Plans.
Mark S. Nelson reports on recent research by the Council of Institutional Investors, examining poison pills adopted in 2020, which finds some pro-shareholder developments but also questions whether implementation of poison pills during the coronavirus pandemic will benefit stockholders in CII report examines the reemergence of the poison pill.
The Return of Poison Pills: A First Look at “Crisis Pills” examines renewed adoption of poison pills during the coronavirus pandemic, noting trends relating to industry and time of adoption.
King & Spalding suggests that a comprehensive, proactive corporate strategy designed to mitigate company-specific risks is superior to traditional defensive measures such as the poison pill in A New Era For Activist Defense: Going Beyond the Relics of the 80s.
Freshfields discusses the extent to which companies that have adopted poison pills in 2020 as compared with the same period in 2019, and use of currently implemented pills versus “on the shelf” pills based on market capitalization in Not so fast! A revealing look at the data behind recent poison pill adoptions and what boards should be doing now.
DLA Piper discusses the number of adoptions of traditional and Net Operating Loss poison pills in March 2020, and terms that traditional pills have used, in Rise of the aggressive poison pill.
Cleary Gottlieb discusses Net Operating Loss poison pills used to deter acquisitions of stock that could limit a company’s NOL carryforwards and have other negative tax consequences in Is Now a Good Time to Adopt an NOL Rights Plan?
Glass Lewis clarifies its policies on adoption of poison pills and its application during current depressed market conditions Poison Pills and Coronavirus: Understanding Glass Lewis’ Contextual Policy Approach.
Sidley discusses recent guidance by Institutional Shareholder Services regarding the use of poison bills in the current economic environment in ISS Signals More Understanding for Poison Pills and Skepticism for Activist Campaigns During the COVID-19 Crisis.
Fried Frank observes that companies are increasingly considering adoption of stockholder rights plans in due to volatility in financial markets, and discusses characteristics of plans that some companies have recently adopted in A Turn Back to “Poison Pills” in Response to the Coronavirus Pandemic.
Latham & Watkins suggests that market conditions may favor adoption of a stockholder rights plan, and discusses terms of a plan that should be tailored to circumstances that justified its adoption in Proactively Adopting a Poison Pill in Response to the COVID-19 Crisis.
Cleary Gottlieb notes the uniquely threatening nature of current depressed market conditions for unsolicited acquisition or activist agitation, suggesting defensive measured including implementation of “on the shelf” poison pills in Rewriting the Poison Pill Prescription: Consider Active Defenses During COVID-19.
Wachtell, well-known as the creator of the stockholder rights plan popularly known as the “poison pill,” discusses the possible desirability of adopting an “on the shelf” plan in view of recent declines in equity value Rights Plans (“Poison Pills”) in the COVID-19 Environment — On the Shelf and Ready to Go.
Gibson Dunn notes activist accumulation of stakes in publicly traded companies during recent declines in stock prices, and suggests that boards and advisors consider implementation of a stockholder rights plan in Reconsidering Poison Pills.
Davis Polk suggests that, in light of severely depressed stock prices, companies prepare for the possibility of a hostile campaign with an “on the shelf” poison pill ready for adoption in Should companies play strong defense in these hostile times?
Akin Gump discusses adoption of poison pills to deter exploitation of recent declines in stock prices by hostile bidders and activists in Preserving Stockholder Value in a Volatile Market.
Morgan Lewis discusses the potential utility of takeover defense or Net Operating Loss poison pills given extreme drops in market capitalization, noting the prevalent use of such measures during the 2008-2009 financial crisis in As COVID-19 Disrupts Financial Markets, is it Time to Consider a Poison Pill?
Boston College’s Professor Brian JM Quinn discusses the “shadow pill” — a company’s ability to adopt a stockholder rights plan at any time — in the context of bargaining between Hewlett Packard and Xerox in The Shadow Pill is a Powerful Thing.
The Consequences to Directors of Deploying Poison Pills examines career outcomes for directors on boards that adopt poison pills, and whether pills have negative, positive, or inconsequential effects on firms that adopt them.