As a variation of the poison pill defense, the people pill is an anti-takeover defense under which the current management team of the target company threatens to quit en masse in the event of a successful hostile takeover.
The effectiveness of a people pill is dependent on the circumstances of the takeover. If the management team is efficient, the company will be left without experienced leadership following a takeover. On the other hand, a great number of takeovers are the result of inefficient leadership in which management will be fired anyway; the people pill will be ineffective in this situation.
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