Forest Labs adopts shareholder rights plan; Icahn cited
(Reuters) - Forest Laboratories Inc (FRX.N) said its board has adopted a shareholder rights plan in response to activist investor Carl Icahn's recent accumulation of the drugmaker's common stock.
The rights plan will be triggered if a person or group acquires 12 percent or more of Forest's common stock. The plan has an exception for an offer for all shares that is accepted by a majority of the shareholders and treats all shareholders equally.
On Friday, Icahn disclosed that he had increased his stake in Forest to 11.2 percent. The billionaire investor had already ranked as the company's second-largest shareholder and earlier this month won a seat on its board after a bitter proxy fight.
Icahn has accused the company of being unprepared to face generic competition for its top products, the antidepressant Lexapro and the Alzheimer's treatment Namenda.
Forest Labs Chief Executive Howard Solomon said Icahn boosted his stake in the company after "repeatedly and erroneously" disparaging its business model and growth prospects.
The rights plan is intended to ensure fair treatment for all shareholders in the event of any proposed takeover of the company, Solomon said.
Shares of Forest Labs were unchanged in after-hours trading from a close Monday of $34.69 on the New York Stock Exchange.
(Reporting by Susan Kelly in Chicago; editing by Bernard Orr, Gary Crosse)
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