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Los Angeles Business Journal  
Farmer Brothers Adopts 'Poison Pill' Plan
By STEVE SILKIN - 3/16/2005
Los Angeles Business Journal Staff

Torrance-based coffee distributor Farmer Bros. Co. has adopted a "poison pill" plan that would make it harder for an acquirer to pursue a hostile takeover.

The stockholder rights plan, filed Wednesday with the Securities and Exchange Commission, would be triggered if any party acquired more than 15 percent of company stock. That would lead to the issuance of added shares, making it difficult for any one shareholder to take control of the company. Family members, who now control about 39 percent of the company’s stock, could hold up to 45 percent without triggering the rights plan.

Farmer Brothers did not say whether or not the plan was established to ward off any specific takeover offer.

Gary Lutin, who has been managing a shareholder forum on the Farmer Bros. matter for the past three years, said this and other takeover defenses the company’s management has established were evidence that management is not protecting shareholder interests.

“Instead of the board doing something to improve management, they establish takeover defenses to block anybody else from doing so.”

Farmer Brothers officials did not immediately return a call.

Los Angeles Business Journal, Copyright © 2005, All Rights Reserved.


The Forum is open to all Farmer Bros. shareholders, whether institutional or individual, and to professionals concerned with their investment decisions.  Its purpose is to provide shareholders with access to information and a free exchange of views on issues relating to their evaluations of alternatives.  As stated in the Forum's Conditions of Participation, participants are expected to make independent use of information obtained through the Forum, subject to the privacy rights of other participants.  It is a Forum rule that participants will not be identified or quoted without their explicit permission.

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