Barnes & Noble changes poison pill plan

AP News
Posted: Oct 29, 2010 2:49 PM
Barnes & Noble changes poison pill plan

Bookseller Barnes & Noble Inc. appears to have bowed to shareholder pressure and is changing its shareholder rights plan to limit further stakes by Chairman Leonard Riggio and his family, the company said Wednesday.

Shareholders are set to vote on the so-called "poison pill" plan, which limits stakes to 20 percent, on Nov. 17.

The plan was implemented after billionaire activist investor Ron Burkle acquired a 19 percent stake in the company.

He has complained the plan gives an unfair advantage to Chairman Leonard Riggio, who has a nearly 30 percent stake in the company, and his brother, Vice Chairman Steven Riggio. Burkle waged and lost a proxy battle about the issue.

Under the amended plan, the board will not be able to make any additional equity grants to either Riggio, their immediate family members and related trusts without triggering the plan.

Also, if the Riggios and their family members acquire additional shares by exercising options, they must dispose of the option shares within 60 days after they are acquired. They also won't be able to use the shares to influence any shareholder vote.

Last week Leonard Riggio said he wouldn't form a group of investors to buy the company without consent of a special committee formed to evaluate offers.

Barnes & Noble Inc. put itself up for sale in August in response to pressure from billionaire activist investor Ron Burkle. Riggio has said previously he was considering joining an investor group to buy the company.

Shares fell a penny to $14.90 during aftenrnoon trading.