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Posted by on Nov 5, 2012 in Companies |

Netflix plan adopts ‘poison pill’ to protect themselves from aggressive investor

Netflix plan adopts 'poison pill' to protect themselves from aggressive investor

(CC) jeffgunn

U.S. billionaire Carl Icahn last week bought 9.98% of Netflix, which caused the share value of the company to rise by 14% on Wall Street. What is relevant is that Icahn is recognized as an investor trying to aggressively take control of the companies in which he is involved.

Obviously, this fact bothered who fear that Icahn increased his stake in the company to control it and then sell it to another company like Amazon, Microsoft or Google, as he himself acknowledged in an interview a few hours which gave to the news of its acquisition.

To avoid this possibility, Netflix’s board implemented a plan for the new shareholders designed to protect the company against Icahn or any other that creates that “do not have the best interests of its shareholders or Netflix.” This plan is often dubbed as the ‘defense of the poison pill ‘.

The plan comes into operation if an investor buys more than 10% of the company, triggering a clause that any other shareholder to acquire more shares, and the market is flooded with them, increasing the price and make unattractive company to the potential buyer.

What do you think of this plan? Netflix Should remain an independent company, or would be nice if it were sold to another company?

Link: Netflix enacts ‘poison pill’ shareholder plan to challenge new investor’s plans to sell the company (The Verge)

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