Tailored Brands has adopted a shareholder rights plan, or so-called poison pill, aimed at reducing the likelihood that a person or group can gain control of the retailer at its depressed share price.
The parent company of Men’s Wearhouse and Jos. A. Bank said it was adopting the plan due to the coronavirus and the volume and volatility of the stock. The move comes days after Scion Asset Management, which has been criticizing Tailored Brands’ capital allocation strategy, boosted its stake in the menswear retailer to 8.3%.
“The rights plan is designed to allow the company’s shareholders to realize the long-term value of their investment by reducing the likelihood that any person or group would gain control of Tailored Brands through open market accumulation without appropriately compensating the company's shareholders for such control or providing the board sufficient time to make informed judgments,” Tailored Brands said in a statement.
The rights can be exercised if someone or a group gathers 10% or more of outstanding common shares.