The article discusses the topic of hostile takeovers in the tech industry, where a company attempts to acquire another company without its consent. The author highlights various strategies that companies use to defend against hostile takeovers, including poison pills, dual-class share structures, and anti-takeover measures such as changing contractual terms or saddling an acquirer with debt.
Some key points from the article include:
- Poison pills: These are a type of defense mechanism that allows a company to issue more shares or change its bylaws in response to a hostile takeover bid.
- Dual-class share structures: Companies like Facebook have dual-class share structures, where one class has more voting power than others. This can make it harder for an acquirer to gain control of the company.
- Anti-takeover measures: Companies can adopt various measures to deter friendly acquisitions, including changing contractual terms or requiring a supermajority shareholder vote for M&A activity.
- Tech giants’ defense strategies: Tech giants like Facebook and Twitter have employed various defense strategies, including dual-class share structures and poison pills.
The article also notes that while hostile takeovers can be unpredictable, some companies may still attempt to recruit other shareholders or apply public pressure on a company’s board until they reconsider a bid.
