The Board of Directors and the Adoption of Poison Pills
Posted: 22 May 1995
In this paper we analyze how the stock-market reaction to the adoption of poison pills and the subsequent outcome of takeover attempts vary with the composition of the firm's shares among competing bidders and by other firms to entrench managers at the shareholders' expense. Our results also suggest that outside directors can be important in helping to align the interests of the board with the interests of shareholders.
JEL Classification: G10
Suggested Citation: Suggested Citation