Glenn, what a bummer! There goes my speculation Yhoo will be bought out...easily!
>March 2, 2001
SAN JOSE – Shares of leading Internet portal Yahoo! Inc. plummeted Friday after the company adopted a shareholder rights plan to deter a hostile takeover.
Yahoo shares fell $2.25 to $22.19 in trading on the Nasdaq Stock Market. The company announced the plan late Thursday, after its shares had closed up 63 cents at $24.44.
The Santa Clara-based company, which boasts more than 54 million visitors a month, has become an attractive takeover candidate after its shares have plunged by more than 90 percent from its 52-week high of $205.62, analysts say.
Answering to speculation that Walt Disney Co. might want to acquire Yahoo, Disney chairman Michael Eisner said in February the company would be willing if the price was right.
Yahoo said Thursday, however, that the rights plan "was not adopted in response to any effort to acquire control of Yahoo."
"The Rights Plan is designed to deter coercive takeover tactics, including the accumulation of shares in the open market or through private transactions and to prevent an acquirer from gaining control of Yahoo! without offering a fair and adequate price and terms to all of Yahoo!'s stockholders," Yahoo said in a statement.
Under the plan, Yahoo shareholders will have the right to buy one unit of a share of preferred stock for $250 if a person or group acquires at least 15 percent of the company's stock. The rights apply to shareholders of record as of March 20. The rights will expire March 1, 2011.
WR Hambrecht & Co. analyst Derek Brown said the shareholder plan doesn't necessarily mean a takeover is imminent, but it would effectively raise the price of any acquisition and make the deal more complex.
"It certainly seems to be a strong deterrent from an unwanted takeover," Brown said. |
