Allied raises barriers to suitor Directors adopt measures to halt hostile takeover.

June 11, 1991|By Jon Morgan | Jon Morgan,Evening Sun Staff

Allied Research Corp. of Baltimore, concerned about takeover threat from a Saudi investor, has adopted several measures to thwart a hostile bid.

The company said that Kusai H.M. Azzawi, an investor who has suggested changes in the board and management of the company, has increased his holdings to nearly 22 percent of the common stock. Azzawi held about 14 percent of the stock at the time of last month's annual meeting, which he failed to attend despite saying in advance that he would nominate new board members.

Under a shareholder-rights plan adopted Sunday by the board of directors, preferred share purchase rights will be distributed as a dividend at the rate of one right for each common share held as of June 20. The rights will be exercisable and will trade separately from the common shares only if a person or group acquires beneficial ownership of 25 percent or more of the company's common shares or commences a tender or exchange offer that would result in that person or group owning 30 percent or more of the shares.

A spokesman said the measures were a "prudent step that is taken by many corporations."

Allied Research employs about 600 people in Belgium and Chicago, and has a four-person headquarters staff in Baltimore. It makes ammunition and other military goods.

The company also said it has engaged Donaldson, Lufkin & Jenrette Securities Corp. as its financial adviser to assist it in reviewing its strategic alternatives.

Baltimore Sun Articles
Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.