Shares of Chesapeake Energy (NYSE: CHK) are skyrocketing today, up by more than 37% as of 10:30 a.m. EDT, following news that the oil and gas specialist adopted a poison pill to shield its "net operating loss carryforwards" (NOLs) from a potential acquirer.
Chesapeake Energy's board of directors has adopted a shareholder rights plan, also known as a poison pill, to protect the availability of its NOLs. The company had racked up about $7.6 billion of NOLs as of the end of last year that it could use to offset future federal income taxes. These NOLs are the result of years of losses, as Chesapeake has struggled to turn a profit due to mismanagement and commodity price volatility.
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Source: Motley Fool
(April 24, 2020 - 12:16 PM EDT)
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