Netflix Terminates ‘Poison Pill’ Plan, Which Was Designed to Ward Off Hostile Takeover

Netflix Terminates 'Poison Pill' Plan, Which

Billionaire Carl Icahn sold half his stake in Netflix in October, now holding 4.5% of the company's shares

Netflix announced Monday that it has terminated its stockholder rights plan — known as a poison pill, designed to prevent a hostile takeover — two years early, after billionaire investor Carl Icahn cut his stake in the company in half.

Netflix adopted the plan in November 2012, after Icahn bought shares amounting to a 9.98% stake. Under the poison pill provision, if any individual investor acquired more than 10% of Netflix stock every other shareholder would be eligible to purchase discounted stock (thereby diluting the equity of the poison-pill initiator).

In October 2013, Icahn filed to sell nearly 3 million shares of Netflix, citing a 457% return on his investment, after which he owns 4.5% of the company’s shares.

On Monday, Netflix said the shareholder rights plan was amended to accelerate the expiration date to Dec. 30, 2013, effectively terminating the plan. It was originally set to expire on Nov. 2, 2015.

Filed Under:

Want to read more articles like this one? SUBSCRIBE TO VARIETY TODAY.
Post A Comment 1

Leave a Reply

1 Comment

Comments are moderated. They may be edited for clarity and reprinting in whole or in part in Variety publications.

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

  1. Ashley James says:

    Netflix’s subscribers have increased from around 29.4 million to nearly 40.3 million over the last one year alone, and its stock price has rallied by almost 300% year-to date.

    http://bit.ly/NetflixTheKing

More Digital News from Variety

Loading