NEW YORK (AP) — Teen clothing company Aeropostale is adopting a plan to help it ward off any potential hostile takeover attempts.
The announcement comes less than a week after investment firm Hirzel Capital Management LLC disclosed that it bought a stake in the retailer.
Aeropostale Inc. said Tuesday that its limited term stockholder rights plan isn't intended to prevent an acquisition that its board deems favorable and in the best interest of shareholders. It said the plan, often called a "poison pill," is meant to give shareholders adequate time to assess a takeover offer and if necessary, give the board time to explore options to maximize shareholder value.
Aeropostale said its board is not adopting the plan in response to any particular acquisition offer.
Last Wednesday, Hirzel Capital disclosed in a regulatory filing that it has a 6 percent stake in Aeropostale. The investment firm also said that it plans to have discussions with Aeropostale's management and that the company's shares were "undervalued and represented an attractive investment opportunity."
The New York-based retailer said Tuesday that it plans to put the stockholder rights plan to a vote at its 2014 annual shareholders meeting and if it is not approved the plan will expire on the day of the meeting.
Aeropostale currently runs 902 of its namesake stores in 50 states and Puerto Rico, 79 Aeropostale stores in Canada and 149 P.S. from Aeropostale stores in 32 states and Puerto Rico.
Its stock slipped 6 cents to $10.15 in morning trading. Its shares have fallen more than 21 percent so far this year.