Directors of US WEST have adopted a plan they say is designed to ensure shareholders "fair and equal treatment" if the company is involved in a takeover attempt.
A US WEST spokesman said the Shareholder Rights Plan would have the effect of giving the company's board more time to consider alternatives to a proposed takeover, which could protect shareowners from partial tender offers and other "abusive tactics" that might be used in attempting to gain control of the company "without paying all stockholders a fair price."Chairman Jack A. MacAllister said the plan is not due to any current attempt to take over the company and is not intended to prevent a takeover on terms that would be fair and in the best interests of all shareowners, but would "encourage any person seeking to acquire US WEST to negotiate with the board of directors before attempting a takeover."
The plan provides for the distribution to each shareowner of one "right" for each share of stock held on April 19, 1989. In the event of a takeover or attempted takeover in which any person acquired 20 percent or more of the company's outstanding common shares, the rights would be activated and carry with them the power to acquire additional US WEST stock at approximately half its market price.
This would make a proposed takeover more expensive for the acquiring party, who would not be permitted under the plan to exercise the rights.
The rights expire on April 6, 1999 and are subject to redemption by the US WEST board of directors at 1 cent per right at any time prior to the date they would become effective.
Several other regional Bell companies have adopted such plans, as have some 800 other companies. US WEST said it will provide shareowners with further details of the plan next month.
The company currently has more than 182 million shares outstanding, held by more than a million shareowners.