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Jonestown Defense

Jonestown defense refers to an extreme defensive tactic used by a company desperately avoiding a hostile takeover. The management of the target corporation will employ the Jonestown defense though strategies that are so extreme, they may even result in the destruction of the target company. A company employing the Jonestown defense is so concerned with the effect of a hostile takeover, it would rather destroy itself than risk the takeover. Since the management is well aware of the potentially devastating risks associated with a Jonestown defense, the Jonestown defense is often referred to as a "suicide pill." The term "Jonestown defense" refers to the 1978 Jonestown massacre in Guyana where a religious cult - 913 people - committed mass suicide.


               


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