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Finance allah shmoop what is a poison pill O romeo

romeo Wherefore out the ac Well if you can't have

me nobody can have me pill lug dead dead alright

that's poison pill allah romeo and juliet and performed by

your friends here and the corporate version Well it isn't

all that different In fact there are really two flavors

of poison pill flintstones chewable lt's called flip ins which

allow current shareholders to buy a ton more shares at

a big discount toe where their shares are currently trading

flippen like if the shares are at forty bucks each

current shareholder than gets allowed to buy five shares for

ten bucks each for each share that they currently own

and have owned for the last in a year About

that would be a flipping well this flip in process

dilutes the company dramatically making it harder for an outside

takeover soldier to come in and you know just buy

the company that's a flip in the non chewable flintstone

flavor that you have to actually swallow is called ah

flip over which comes is a mandate from the board

allowing current shareholders to buy the shares of the acquirer

After the merger at a big discount it basically destroys

enormous value in the combined company making It tastes like

a bitter moth to ah hungry bat so you know

he spits it out The basic idea in these poison

pill defense strategies is to deal with hostile takeovers And

a lot of those came during the junk bond era

in the nineteen eighties when cheap high risk capital was

liquid Lee easily available almost anywhere and companies felt vulnerable

to short term quick buck wall street sharpies who looked

great in a dark suit and usually had awesome hair

So yeah people for details carefully watch wall street the

first one the good one the one with michael douglas

when he still had hair and what you don't really 00:01:54.212 --> [endTime] hear there is he said Shmoop is good yeah