Starz Entertainment said Wednesday that its board voted unanimously to adopt a limited-duration shareholder protection rights agreement, also known as a “poison pill,” effective immediately and expiring in a year. The move follows Byron Allen acquiring a big chunk of stock in the company.
The Allen Media Group founder and CEO unveiled a 10.7% stake in Starz last week. He paid $25 million for 1.8 million shares. Shareholder rights plans make buying stock over a certain threshold more expensive, usually prohibitively so. It’s a defensive strategy used by companies against hostile takeovers. In this case, the rights will be triggered by a person or group acquiring a 17.5% ownership stake. The plans allow existing stockholders to buy shares at a steep discount, which dilutes the value and voting power of new share purchases.
Newly public Starz, run by CEO Jeff Hirsch, separated from Lionsgate Studios last year. Lionsgate
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