BEVERLY HILLS, Calif. -- Tracinda Corp. said Tuesday that it is withdrawing its cash tender offer of $64 a share for up to 21.875 million shares, or 16%, of Tesoro Corp., after the independent oil refiner-marketer initiated a poison pill provision in its bylaws last week, according to MarketWatch.
"The rights plan recently adopted by the Tesoro board of directors inhibits value for all Tesoro shareholders by, among other things, restricting the ability of shareholders to vote, sell or acquire Tesoro shares freely without fear of triggering the draconian [image-nocss] provisions of the rights plan," said a statement by Beverly Hills, Calif.-based Tracinda, the holding company for billionaire Kirk Kerkorian.
The poison pill would have been triggered if any shareholder acquired more than 20% of Tesoro. It would not have applied, however, if Tracinda had followed through with its tender offer, which would have raised its total stake in the San Antonio firm to just under 20%. The plan also includes a provision that holders of stakes of 10% or more can request a special meeting to exempt a "qualifying offer" from triggering the rights plan.
The $64-a-share offer was a 12% premium over the previous day's closing price.
Tracinda's offer would have expired on December 6, unless it was extended.
Tesoro operates seven refineries in the western United States with a combined capacity of approximately 660,000 barrels per day. Tesoro's retail-marketing system includes more than 900 branded retail stations, of which more than 445 are company owned under the Tesoro, Shell, Mirastar and USA Gasoline brands.
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