Rejecting the recommendation of Comcast Corp.'s top management, independent shareholders approved a nonbinding resolution that seeks to dismantle the Philadelphia company's poison-pill takeover defense.
The shareholder vote was 186.5 million votes for the resolution, or 52 percent, and 171.4 million, or 48 percent, against.
Brian Roberts, the chairman and chief executive officer, controls 33.3 percent of the votes through a special super-voting class of stock, which experts thought should have been sufficient to defeat the resolution.
Kenneth Steiner, longtime shareholder activist and private investor who submitted the Comcast proposal, said Monday, "I was surprised because so much of the stock is controlled by insiders. … I win a lot of votes, but not always when I start so far behind."
Steiner, of Great Neck, N.Y., called the poison pill a "de facto veto power" held by management over deals that could benefit shareholders. He said the Comcast board could take action as soon as its next meeting.
Comcast's takeover defense, which it calls a shareholder rights plan, expires this November. Company spokesman John Demming said Comcast's board would take the shareholder vote into consideration when discussing renewing the plan. The cable and media giant disclosed the vote results from its annual meeting at the Convention Center on Thursday in a regulatory filing.
Jill E. Fisch, law professor and corporate governance expert at the University of Pennsylvania Law School, said takeover defenses are viewed by some shareholders as a "symbol of entrenched management," but they also serve a useful purpose in that they prevent a company from being forced into a sale in a time of stock-market turmoil. "It's a surprise in Comcast because you have a CEO who controls one-third of the vote," Fisch said.
Experts say shareholder proposals on poison pills have been gaining support with institutional investors. Comcast's plan was enacted in 2002 when it acquired AT&T's broadband division. Such plans can make takeovers prohibitively expensive for an acquirer. Comcast says its plan preserves shareholder value.