Atlanta, GA, January 24--Home Depot said that it may adopt a shareholder rights plan without prior shareholder approval if its board determines that waiting for consent isn't in the company's best interest.
In most circumstances, though, the company said it will obtain shareholder approval before adopting such a holder rights plan as a potential takeover defense.
In a Securities and Exchange Commission filing, the home improvement retailer outlined its new policy on shareholder rights plans. It said that if the company's board adopts a rights plan, "it will do so after careful deliberation and in the exercise of its fiduciary duties."
Shareholder rights plans, also known as "poison pills," are typically used by companies to discourage a hostile acquisition by another company by making its stock less attractive to the acquirer.
If a rights plan is adopted without prior stockholder approval, Atlanta-based Home Depot said in the filing, the plan must be ratified by shareholders within one year or it will expire.
