Business

JC Penney adopts ‘poison pill’

PLANO, Texas — Struggling retailer J.C. Penney Co. is adopting a plan to prevent a takeover attempt just two days after reporting its sixth straight quarter of big losses and steep revenue declines.

It’s the second time in recent years that the company has put into place a so-called ‘‘poison pill’’ plan.

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In October 2010 Penney enacted the defense after activist investor William Ackman of Pershing Square and Vornado Square Management, chaired by Steve Roth, snapped up large stakes.

The company eventually put both men on its board, a decision that ended badly last week.

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Ackman resigned from the board after lashing out at other directors publicly. The two sides hammered out an agreement that will allow Ackman to unload his Penney stake. Roth is still on the board.

Penney said there is no current attempt to take over the company.

The plan disclosed Thursday can be put into effect if an individual or an entity acquired 10 percent or more of the company’s outstanding stock.

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The corporate defense strategy allows existing shareholders to buy more shares at a very low price if that occurs.

The retailer is trying to survive a botched turnaround strategy by ousted chief executive Ron Johnson. It brought Mike Ullman to the top post in April, after he occupied the position from 2004 to 2011.

Penney amassed nearly $1 billion in losses and its revenue dropped 25 percent for the fiscal year that ended Feb. 2 in the first year of Johnson’s turnaround strategy.

Penney said that its ‘‘poison pill’’ will be effective until Aug. 20, 2014, unless rights are redeemed or exchanged for shares of its common stock on an earlier date.

Shares fell 13 cents to $13.20 Thursday on the New York Stock Exchange.

Associated Press

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