Penney adopts poison pill to ward off any coercive takeover
(Reuters) - J.C. Penney Co Inc (JCP.N: Quote) on Thursday said it had adopted a one-year stockholder rights plan to protect itself against any future coercive takeover efforts.
The department store chain, which is struggling to reverse a massive sales slide, said the "poison pill" plan was not in response to any particular takeover attempt. The provisions would block any single investor from owning more than 10 percent of the retailer's shares.
The move comes after a public feud earlier this month between Penney's board and largest shareholder, William Ackman. The owner of nearly 18 percent of the company from shares he bought in 2010, Ackman has since resigned from the board. This week he said he might sell his stock.
Shares of Penney rose 1.3 percent to $13.50 in trading before the market opened.
"Poison pills" are designed to dilute holdings of an investor should his or her stake exceed a given threshold. Penney said it would file details of the plan with the U.S. Securities and Exchange Commission.
Penney, whose shares have slid 32 percent this year, has attracted investors such as George Soros' Soros Fund Management, which owns a 9.1 percent stake, and Perry Capital, which owns 7.3 percent, in recent months.
The company is struggling to win shoppers back after a failed attempt by Ackman's handpicked chief executive, the now-departed Ron Johnson, to reinvent itself as a trendier retailer led to a 25 percent sales slide last year.
On Tuesday, Penney reported sales at stores open at least a year fell 12 percent.
(Reporting by Phil Wahba in New York; Editing by Gerald E. McCormick and Lisa Von Ahn)
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