(FORTUNE Magazine) – Major corporations are rushing to set up or expand employee stock ownership plans, or ESOPs (see table for a sampling). The some 100 that have initiated , them this year include companies that are installing ESOPs as tax-sheltered employee benefit plans. But many managers see in ESOPs a new way to defend themselves against hostile takeovers. This latest in poison pills follows 1988's raid on Polaroid by Roy Disney's Shamrock Holdings. Polaroid was in the process of creating an ESOP, giving employees 14% of the company, when Shamrock attacked. Under Delaware law, where Polaroid and most big U.S. corporations are registered, a takeover bid must be accepted by the holders of at least 85% of nonaligned shares, which excludes inside directors. Since employees with ESOP shares and trustees with power to cast ESOP votes usually side with management, a big ESOP plan can stop a hostile bid. Future raiders may well sue trustees, claiming violation of fiduciary duty to employee shareholders. Steven Goldberg, a partner of Theisen Lank Mulford & Goldberg, a Wilmington law firm, says that a company's defense will be stronger if its ESOP is in place before a takeover bid. Congress is considering legislation that would lessen tax benefits for lenders who finance ESOPs, making some plans more expensive. Yet the ESOP boom is likely to continue as a defense against takeover. Says Lilli Gordon, research director of Analysis Group, a Belmont, Massachusetts, economics and financial consulting firm: ''ESOPs enable management to place a large block of shares in friendly hands, quickly.''

BOX: CORPORATIONS WITH ESOPs IN PLACE Company ESOP stake Anheuser-Busch 4 General Mills 2 ITT 8 Lockheed 18 McDonald's 3 PPG Industries 14 Procter & Gamble 21 Quaker Oats 3

SOURCE: ANALYSIS GROUP