Safeway sets poison pill after investor buys 'significant' stake
(Reuters) - Supermarket operator Safeway Inc (SWY.N) on Tuesday adopted a one-year "poison pill" designed to ward off an unwanted takeover after becoming aware of an investor buying "a significant amount" of its stock.
Safeway, which operates its namesake chain as well the Vons and Dominick's stores, said in a statement that the shareholder rights plan will prevent any one investor, with some exceptions, from owning more than 10 percent of its shares.
The company said the move is necessary while it implements its strategic plan, which includes the pending sale of its Canadian assets and the initial public offering in April of its Blackhawk Network gift card business.
"Poison pills" are designed to dilute holdings of an investor should its stake exceed a given threshold.
Safeway shares were up 8.6 percent to $30.46 Tuesday morning.
(Reporting by Phil Wahba in New York; Editing by Gerald E. McCormick)
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