WebMD extends poison pill defense
NEW YORK -- WebMD extended its poison pill defense, first put into place to ward off billionaire investor Carl Icahn, for another two years.
The company is struggling to maintain advertising revenue as drugmakers pull back spending at the online health information company.
It also changed the plan, so that it will not count stock grants to the company's directors when determining whether a shareholder becomes an "acquiring person" under the plan.
Poison pill measures are designed to prevent unwanted attempts to acquire or take control of a company by giving other shareholders the right to purchase more company stock at a discount, thereby diluting the shares held by the potential suitor and making it more costly to take over the company.
WebMD slashed the purchase price for shareholders if the rights are exercised to $66.29 from $153. Shareholders will have a chance to vote on the changes at the company's upcoming 2013 shareholder meeting.
The company originally adopted the plan in November 2011 after Icahn revealed he had a nearly 8 percent stake in the company. Icahn later increased his stake to about 13 percent.
WebMD's sites include WebMD Health, MedicineNet, RxList and theheart.org. It has been under pressure recently as drug companies cut back on advertising and it faces more competition from social networking sites and ad networks.
The company's stock has tumbled more than 60 percent this year and it said in July that it expects to post a loss for this year.
Shares of WebMD Health Corp. fell 10 cents to $14.10 in midday trading.