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Baker International Corp. Adopts Takeover Defense

May 30, 1986|LESLIE BERKMAN | Times Staff Writer

Although denying knowledge of any imminent takeover attempt, Orange-based Baker International Corp. said Thursday it has adopted a traditional "poison pill" to discourage any unfriendly buy-up of the oil service company's stock, which has fallen sharply in price in recent years.

E. H. Clark Jr., Baker's chairman and chief executive officer, said the board of directors on Wednesday adopted a stockholders' rights plan to protect Baker's shareholders in the event of an unfriendly takeover attempt.

Terms of the plan call for the issuance, as a dividend, of one right for each share of Baker common stock held of record on June 9, 1986.

The rights, which will kick into effect if anyone accumulates 20% or more of Baker common stock or if there is a tender offer to acquire 30% or more of Baker's common stock, allows holders to buy newly issued common shares or stock in the acquiring company at a 50% discount.

But the party attempting the takeover would be obliged to continue to pay full price for any Baker stock.

Right to Buy Preferred Stock

In addition, each right entitles the holder to buy .01 of a share of preferred stock from Baker at $48.

Baker generally will be entitled to redeem all of the rights at three cents per right at any time until an acquiring entity obtains 20% of Baker common stock.

Baker Vice President Ronald G. Turner said the company does not know of any present takeover threat to Baker but has adopted the poison pill as "a matter of prudence."

Like other oil service companies whose businesses are suffering severely from declining oil production, Baker has seen the price for its stock plummet, falling to about $14.50 a share from about $53.50 a share in the last quarter of 1980.

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