NEW YORK (CNNfn) - Nabisco Group Holdings Inc. on Monday adopted a shareholder rights plan, just hours after announcing corporate raider Carl Icahn had made his latest move to take control of the snack food company.|
Nabisco said earlier in the day it received notice that Icahn, one of its biggest shareholders, planned to elect nine directors to the company's 11-member board at its annual meeting. Icahn nominated himself and eight others as directors, Nabisco said.
As part of the plan adopted Monday, if any person takes control of 10 percent or more of the company, Nabisco and its other shareholders can take a series of actions that would make the acquisition of full control costly.
Icahn, who owns New York-based Icahn & Co. Inc., previously sought the election of a board slate, and proposed eight of this year's nominees last year. He also submitted similar proposals in 1996 and 1997, according to a Nabisco spokesman.
The company has not yet chosen a date for its shareholders' meeting. Icahn was not immediately available for comment.
Last month, New York-based Icahn & Co. announced that it had acquired a 7.8 percent stake in Nabisco Group because it believed the shares were undervalued. Combined, the group holds approximately 21.7 million shares for which it paid almost $229.2 million, according to Securities and Exchange Commission filings.
The Icahn proposal comes as the company struggles to boost its sagging share price and compete in the competitive cookie market. Since last fall, Nabisco has been involved with privately held Hicks Muse Tate & Furst in bidding for British-based United Biscuits. French food firm Danone and a number of financial backers recently made a higher counteroffer.
Nabisco Group Holdings (NGH: Research, Estimates) owns approximately 80 percent of Nabisco Holdings Corp., the parent company of Nabisco Inc., one of the world's major manufacturers of cookies, crackers, snacks and premium grocery products. Its shares fell 1/8 Monday to 8-5/8, just above their year low of 8-3/16.
Nabisco Group Holdings was known as RJR Nabisco Holdings Corp. (RN: Research, Estimates) prior to the June 1999 separation of RJR Nabisco's tobacco and food businesses. The separation was accomplished through a spin-off of the domestic tobacco business to stockholders.