Journal article
Poison Pill Securities: Stockholder Wealth, Profitability, and Ownership Structure
Journal of financial economics, v 20(1,2), pp 347-376
01 Jan 1988
Abstract
The wealth effects of poison pill securities and hypotheses about the characteristics of firms that adopt them are tested by analyzing data pertaining to 132 firms that announced the intention to adopt poison pill defenses between December 1982 and March 1986. With one exception, the firms are identified in issues of Corporate Control Alert. Rights agreements, designations and preferences, preferred stock certificates of rights, and/or summary letters sent to stockholders to ascertain the characteristics of the various poison pills were studied. Results indicate that shareholder wealth is reduced significantly by poison pill defenses. It also is found that firms who adopt them are substantially less profitable than the average firm in their industries during the year before adoption. It is shown that managers of these firms hold smaller amounts of their own firms' shares than the average amount held by managers of other firms in the same industries.
Metrics
Details
- Title
- Poison Pill Securities: Stockholder Wealth, Profitability, and Ownership Structure
- Creators
- Paul Malatesta - University of WashingtonRalph Walkling - The Ohio State University
- Publication Details
- Journal of financial economics, v 20(1,2), pp 347-376
- Publisher
- Elsevier Sequoia S.A
- Resource Type
- Journal article
- Language
- English
- Academic Unit
- Finance
- Web of Science ID
- WOS:A1988P478700013
- Scopus ID
- 2-s2.0-33748582079
- Other Identifier
- 991021881390904721
InCites Highlights
Data related to this publication, from InCites Benchmarking & Analytics tool:
- Collaboration types
- Domestic collaboration
- Web of Science research areas
- Business, Finance
- Economics