Subject:
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Re: Not looking good for eToys...
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Newsgroups:
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lugnet.market.shopping
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Date:
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Sun, 31 Dec 2000 01:17:58 GMT
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Viewed:
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664 times
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In lugnet.market.shopping, Jeff Shiner writes:
> In lugnet.market.shopping, Larry Pieniazek writes:
> > In lugnet.market.shopping, Jeff Shiner writes:
> >
> >
> > > Actually I suspect that a conventional retailer or white knight could NOT
> > > buy eToys.
> > > Under Section 203 of the Delaware General Corporation Law they are forbidden
> > > to engage in a business combination with an interested stockholder for a
> > > period of 3 years following the date that that person became an interested
> > > stockholder.
> > > Now I am not a legal expert by a long shot but this section does apply to
> > > eToys as stated in their form 8-K filing and seems to make it difficult for
> > > a white knight or retailer to purchase or merge with them.
> >
> > That's a hostile takeover defense and Delaware law is friendly to
> > corporations so I doubt this would apply to a friendly (white knight)
> > takeover...
>
> Here is an associated snipper from one of eToys legal filings:
>
> "IT MAY BE DIFFICULT FOR A THIRD PARTY TO ACQUIRE US EVEN IF DOING SO WOULD BE
> BENEFICIAL TO OUR SECURITYHOLDERS.
>
> Provisions of our amended and restated certificate of incorporation,
> our amended and restated bylaws and Delaware law could make it more difficult
> for a third party to acquire us, even if doing so would be beneficial to our
> securityholders."
>
> Of course it goes on and on but it does mention section 203 as one of the
> barriers to a possible acquisition.
>
> Read here for the full details if interested:
> http://biz.yahoo.com/e/001207/etys.html
I'll stick to what I said. Section 203 is a poison pill defense and what
you're quoting from is bluesky boilerplate that is in hundreds of 10Ks and
8Ks... means nothing.
Of course a hostile takeover may be beneficial to security holders. Almost
any takeover is beneficial to stockholders, especially when we're talking
drillbit prices.
If a white knight appears you can be *sure* a takeover will happen, section
203 or no. But this is *all* *beside the point I made*, which is that I
doubt any white knight will appear, making this all moot. If you want to
debate the finer points of M&A, take it up in .debate... I am actually not
all that interested, though.
I repeat my original point. Be careful in dealing with eToys from here on
in, and don't wait till the last days to buy stuff, you may be in for some
hassle if the merch doesn't show or gets lost, etc.
++Lar
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Message is in Reply To:
 | | Re: Not looking good for eToys...
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| (...) Here is an associated snipper from one of eToys legal filings: "IT MAY BE DIFFICULT FOR A THIRD PARTY TO ACQUIRE US EVEN IF DOING SO WOULD BE BENEFICIAL TO OUR SECURITYHOLDERS. Provisions of our amended and restated certificate of (...) (24 years ago, 31-Dec-00, to lugnet.market.shopping)
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