Part 5/13:
This poison pill was activated if any individual or entity acquired more than 15% of the company’s shares, diluting such ownership with new shares issued to other shareholders. Its primary goal: prevent outside bidders from gaining control without negotiation.
Post-announcement, the stock traded around $5.50, and a private equity firm interested in acquiring Sinovac for $8 per share found an innovative way to lower their costs. By purchasing nearly half of the shares on the open market—costing approximately $160 million—they could leverage the poison pill to acquire the remaining shares at the $8 offer for much less than buying all shares at $8 outright, thus saving hundreds of millions of dollars.