Saks Inc. on Monday ended a “poison pill” provision in its shareholders’ rights plan that it had adopted last year to prevent a takeover.
This story first appeared in the December 15, 2009 issue of WWD. Subscribe Today.
The luxury retailer enacted the condition, meant to kick in if a single investor held more than 20 percent of its shares, in November 2008, shortly after Mexican billionaire Carlos Slim Helú upped his stake in the firm to 18.3 percent.
Chairman and chief executive officer Stephen I. Sadove said the rights plan had served its purpose and was no longer necessary because the firm increased a change-of-control threshold to 40 percent when it altered its revolving credit agreement on Nov. 23.
In December 2008, Saks distributed a preferred share purchase right for each outstanding share of its common stock. The right would have only been redeemable if an investor acquired 20 percent or more of the firm’s shares and was designed to dilute such an acquirer’s stake. In a Securities and Exchange Commission filing at the time, the company said it had done so to “protect shareholders from coercive or otherwise unfair takeover tactics.”
Slim certified he had not taken the larger stake in the company to change or influence the retailer in his own SEC filing.