Billionaire investor Ronald Burkle said the poison-pill plan that Barnes & Noble Inc. enacted to stop him from taking a larger share in the company has imposed draconian restrictions on his ability to wage a potential proxy fight against the Riggio family which controls the bookseller.
Testifying at a civil trial in Delaware Chancery Court, Mr. Burkle said the shareholder-rights plan's rules were so confusing and far reaching that he hasn't even been returning the calls of other Barnes & Noble shareholders for fear of tripping certain regulations. He said his investment firm, Yucaipa Cos., may wage a proxy battle to replace three Barnes & Noble board members, but the rules have made it nearly impossible to determine if the proxy would pass.
Barnes & Noble adopted the rights plan last November in an effort to halt Burkle's rapid accumulation of shares. Yucaipa holds about 18.7 percent of Barnes & Noble's outstanding shares, while the threshold for triggering the rights plan is 20 percent.
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