The TIAA-CREF and Florida State Board of Administration's (FSBA) shareholder proposal calling for the removal of the dead hand poison pill takeover defence from Profit Recovery Group International's (PRG) charter gained 63% of the vote at PRG's annual meeting.
A poison pill is a takeover defence, in which a takeover target tries to make its stock less attractive to an acquirer. Dead hand versions of the poison pill prevent directors elected in any proxy contest, who have not been approved by existing directors, from removing the pill. This, according to the TIAA-CREF, renders any hostile takeover near impossible.
According to Peter Clapman, the TIAA-CREF's senior vice president and chief counsel, the vote at PRG is a sign that: shareholders have declared dead hand poison pills to be totally unacceptable.
Based in New York, the TIAA-CREF currently has $290bn in assets under management. The TIAA is the Teachers Insurance and Annuity Association, and the CREF is the College Retirement Equities Fund, an open-end, diversified management company registered with the federal Securities Exchange Commission. TIAA-CREF also provides mutual funds, mutual funds IRAs, tuition savings programs, and trust services to the general public.
The FSBA is the state body that runs the $102bn defined benefit (DB) Florida Retirement System. The FSBA is currently in the process of creating a new optional defined contribution plan, the Public Employee Optional Retirement Program (PEORP).
PRG provides recovery audit services.
By Geoffrey Ho
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