Saks Drops "Poison-Pill" Plan

From NYTimes.com:

Saks Dismantles Shareholder Rights Plan
December 14, 2009, 6:48 pm

Saks said on Monday it was ending changes it made to its shareholders rights plan last year when it sought to prevent a potential hostile takeover by Mexican billionaire investor Carlos Slim Helu, Reuters reported.

In a statement, Saks’s chief executive, Steve Sadove, said those steps were “no longer necessary” because of a change made last month to its revolving credit agreement, which raised a “change-of-control” threshold to 40 percent from 20 percent.

In November 2008, the upscale retailer, known for its flagship Saks Fifth Avenue store in Manhattan, introduced the changes to protect itself after Mr. Slim reported a stake in the company of 17.8 percent, making him the biggest investor.

At the time, the company said it would distribute one preferred share purchase right for each outstanding share of Saks common stock.

Saks had also said last year that if any individual or investor reached or surpassed a 20 percent stake, those rights would let shareholders buy shares at a 50 percent discount and give them ammunition to block an unwanted overture.

Saks said at the time that the action was intended to “impose a significant penalty upon any person or group” acquiring 20 percent.

Mr. Slim owned 25.6 million shares, or 16.1 percent, of Saks’s shares as of April 6, the most recent date for which data is available, according to Thomson Reuters.