J.C. Penney Adopts Poison Pill to Prevent Hostile Takeovers; Posts Bigger Losses than Expected

For the second time in recent years, troubled retailer J.C. Penney has put into effect a “poison pill” plan to protect against hostile takeovers. The chain reported that provisions of the one-year shareholder’s rights plan will be effective until Aug. 20, 2014, unless rights are redeemed or exchanged for shares of its common stock on an earlier date. The plan would be set into action if a person or group acquires 10 percent or more of the company’s shares or begins a tender or exchange offer that would result in someone owning more than that portion of the shares. The plan comes in the wake of news that the retailer posted a wider-than-expected loss of a nearly 12 percent drop in revenue in its second quarter.