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Gemstar prepares poison pill
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July 13, 1998: 7:43 a.m. ET
Company digging in its heels against $2.8B takeover bid from United Video
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NEW YORK (CNNfn) - Gemstar International Group Ltd. over the weekend began digging in its heels to stave off a $2.8 billion takeover bid from United Video Satellite Group Inc.
Gemstar, which makes the VCR Plus+ home video recording system, said it has adopted a shareholder-rights plan, or "poison pill," that essentially would prevent United Video from gaining control by buying a majority of Gemstar's shares on the open market.
"The board took these actions taking into account the company's stage of business development and the unsolicited offer from United Video in order to protect the interests of all of its shareholders," said Henry Yuen, president and chief executive officer.
The company did state, however, that while it is not for sale, its board of directors is evaluating United Video's proposal.
United Video, which is controlled by cable giant Tele-Communications Inc. (TCOMA), made its offer to Gemstar public last week.
United Video currently provides the Prevue Channel, an on-screen TV listing that reaches more than 50 million homes. With its bid for Gemstar, United Video hopes to dominate the electronic TV listings business.
The company recently agreed to acquire TV Guide from News Corp. for $2 billion in cash and stock.
Shares of Gemstar (GMSTF) slipped 3/4 in Friday trading to close at 40-1/8. United Video (UVSGA) shares closed at 34, also down 3/4. 
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