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Poison pills were developed in the early 1980s as a defense tactic against corporate raiders to effectively poison their takeover efforts, sort of reminiscent of the suicide pills that spies supposedly swallow if captured. There are many variants of poison pills, but they generally increase the number of shares, which then dilutes the bidder's stake and causes them a significant financial loss. Let's say a company has 1,000 shares outstanding valued at $10 each, which means the company has a market value of $10,000. An activist investor purchases 100 shares at the cost of $1,000 and accumulates a significant 10 percent stake in the company. But if the company has a poison pill that is triggered once any hostile bidder owns 10 percent of its stock, all other shareholders would suddenly have the opportunity to buy additional shares at a discounted price, say, half the market price. This has the effect of quickly diluting the activist investor's original stake and also making it worth a lot less than it was before. Twitter adopted a similar measure. If any shareholder accumulates a 15 percent stake in the company in a purchase not approved by the board of directors, other shareholders would get the right to buy additional shares at a discount, diluting the 9.2 percent stake Musk recently purchased. Poison pills are useful in part because they can be adopted quickly, but they usually have expiration dates. The poison pill adopted by Twitter, for example, expires in one year.