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With reference to poison pill, consider the following statements:
1. A poison pill is officially known as a shareholder rights plan, and it can appear in a company’s charter or bylaws or exist as a contract among shareholders.
2. There are different types of poison pills, but usually, they allow certain shareholders to buy additional stock at a discounted price.
Which of the statements given above is/are correct?
- a)1 only
- b)2 only
- c)Both 1 and 2
- d)Neither 1 nor 2
Correct answer is option 'C'. Can you explain this answer?
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Most Upvoted Answer
With reference to poison pill, consider the following statements:1. A ...
's bylaws or charter.
2. The purpose of a poison pill is to deter hostile takeovers by making the acquisition of a company's shares prohibitively expensive or diluting the value of the shares.
3. Poison pills typically involve the issuance of new shares or rights to existing shareholders, which can be exercised if a hostile takeover is attempted.
4. Poison pills can be controversial as they can limit the ability of shareholders to sell their shares for a premium price in the event of a takeover.
5. Poison pills are not universally accepted, and some jurisdictions have regulations in place to limit or prohibit their use.
All of these statements are true.
2. The purpose of a poison pill is to deter hostile takeovers by making the acquisition of a company's shares prohibitively expensive or diluting the value of the shares.
3. Poison pills typically involve the issuance of new shares or rights to existing shareholders, which can be exercised if a hostile takeover is attempted.
4. Poison pills can be controversial as they can limit the ability of shareholders to sell their shares for a premium price in the event of a takeover.
5. Poison pills are not universally accepted, and some jurisdictions have regulations in place to limit or prohibit their use.
All of these statements are true.
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Community Answer
With reference to poison pill, consider the following statements:1. A ...
Twitter countered Elon Musk’s offer to buy the company for more than $43 billion with a corporate tool known as a poison pill, a defensive strategy by boardrooms trying to fend off takeovers.
- This defense mechanism was developed in the 1980s as company leaders, facing corporate raiders and hostile acquisitions, tried to defend their businesses from being acquired by another enterprise, person or group.
- A poison pill is a maneuver that typically makes a company less palatable to a potential acquirer by making it more expensive for the acquirer to buy shares of the target company above a certain threshold.
- The strategy also gives a company more time to evaluate an offer and can give the board leverage in trying to force a direct negotiation with the potential acquirer.
- A poison pill is officially known as a shareholder rights plan, and it can appear in a company’s charter or bylaws or exist as a contract among shareholders.
- There are different types of poison pills, but usually, they allow certain shareholders to buy additional stock at a discounted price.
- Hence both statements are correct.
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With reference to poison pill, consider the following statements:1. A poison pill is officially known as a shareholder rights plan, and it can appear in a company’s charter or bylaws or exist as a contract among shareholders.2. There are different types of poison pills, but usually, they allow certain shareholders to buy additional stock at a discounted price.Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'C'. Can you explain this answer?
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With reference to poison pill, consider the following statements:1. A poison pill is officially known as a shareholder rights plan, and it can appear in a company’s charter or bylaws or exist as a contract among shareholders.2. There are different types of poison pills, but usually, they allow certain shareholders to buy additional stock at a discounted price.Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'C'. Can you explain this answer? for UPSC 2024 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about With reference to poison pill, consider the following statements:1. A poison pill is officially known as a shareholder rights plan, and it can appear in a company’s charter or bylaws or exist as a contract among shareholders.2. There are different types of poison pills, but usually, they allow certain shareholders to buy additional stock at a discounted price.Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'C'. Can you explain this answer? covers all topics & solutions for UPSC 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for With reference to poison pill, consider the following statements:1. A poison pill is officially known as a shareholder rights plan, and it can appear in a company’s charter or bylaws or exist as a contract among shareholders.2. There are different types of poison pills, but usually, they allow certain shareholders to buy additional stock at a discounted price.Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'C'. Can you explain this answer?.
With reference to poison pill, consider the following statements:1. A poison pill is officially known as a shareholder rights plan, and it can appear in a company’s charter or bylaws or exist as a contract among shareholders.2. There are different types of poison pills, but usually, they allow certain shareholders to buy additional stock at a discounted price.Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'C'. Can you explain this answer? for UPSC 2024 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about With reference to poison pill, consider the following statements:1. A poison pill is officially known as a shareholder rights plan, and it can appear in a company’s charter or bylaws or exist as a contract among shareholders.2. There are different types of poison pills, but usually, they allow certain shareholders to buy additional stock at a discounted price.Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'C'. Can you explain this answer? covers all topics & solutions for UPSC 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for With reference to poison pill, consider the following statements:1. A poison pill is officially known as a shareholder rights plan, and it can appear in a company’s charter or bylaws or exist as a contract among shareholders.2. There are different types of poison pills, but usually, they allow certain shareholders to buy additional stock at a discounted price.Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'C'. Can you explain this answer?.
Solutions for With reference to poison pill, consider the following statements:1. A poison pill is officially known as a shareholder rights plan, and it can appear in a company’s charter or bylaws or exist as a contract among shareholders.2. There are different types of poison pills, but usually, they allow certain shareholders to buy additional stock at a discounted price.Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'C'. Can you explain this answer? in English & in Hindi are available as part of our courses for UPSC.
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