Netflix Preps to Avoid Hostile Takeover
By: CNN
Updated: November 5, 2012
Netflix adopts a "stockholder rights plan" designed to prevent activist shareholders from launching a hostile takeover.
It would kick in if an individual or group acquires 10-percent or more Netflix shares without approval from Netflix's board.
If that happened, Netflix can now use a technical maneuver to flood the market with new shares and make a takeover prohibitively expensive.
The defensive move is a direct response to notorious corporate raider Carl Icahn.
Ichan bought a 10% stake in the company last week.
It would kick in if an individual or group acquires 10-percent or more Netflix shares without approval from Netflix's board.
If that happened, Netflix can now use a technical maneuver to flood the market with new shares and make a takeover prohibitively expensive.
The defensive move is a direct response to notorious corporate raider Carl Icahn.
Ichan bought a 10% stake in the company last week.
