Voting plan

Voting plan

A voting plan or voting rights plan is one of five main types of poison pills that a target firm can issue against hostile takeover attempts. These plans are implemented when a company charters preferred stock with superior voting rights to common shareholders. If an unfriendly bidder acquired a substantial quantity of the target firm's voting common stock, it would not be able to exercise control over its purchase. For example, Asarco established a voting plan in which 99% of the company's common stock would only harness 16.5% of the total voting power. [Paul H. Malatesta (University of Washington) and Ralph A. Walking (Ohio State University), "Poison Pill Securities: Stockholder Wealth, Profitability, and Ownership Structure," Journal of Financial Economics, Vol. 20, January/March 1988, p. 355.]

ee also

* Economics
* Japan
* Mergers and acquisitions
* Microeconomics
* Takeover
* Industrial organization

Notes

References

* [http://www.lens-library.com/power/chapter2.html#fnref39 Asarco voting rights plan]


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