PHOENIX (AP) - Auto parts retailer CSK Auto Corp. said Monday its adopted a
"poison pill" shareholder rights plan in an effort to prevent a takeover as more
than 20 parties consider taking stakes in the company.
On Friday, Auto parts retailer O'Reilly Automotive Inc. made a hostile bid
to acquire CSK for about $352 million in stock, after spending a year trying to
reach a deal with the CSK board.
CSK brought on JPMorgan Chase & Co. in December to help evaluate strategic
alternatives for the company. More than 20 parties executed customary
confidentiality and standstill agreements as part of this process, CSK said,
granting them access to nonpublic information. O'Reilly has declined to be part
of the process, CSK said.
CSK said the shareholder rights plan will be triggered if any entity tries
to buy 10 percent or more of CSK's stock.
If the threshold is exceeded, the plan allows each shareholder to purchase
$90 worth of shares for $45. The plan is referred to as a "poison pill" because
it would dilute an acquiring party's holding in the company.
The plan will expire on Feb. 3, 2009. If extended by CSK shareholders, the
plan will expire on Feb. 4, 2011.
Shares remained unchanged at $8.98 in morning trading.
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