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Aaron's changes bylaws after takeover offer

Outside directors will review Vintage Capital bid

ATLANTA — Directors of Aaron's Inc. have adopted several changes to the company's bylaws in the wake of a recent unsolicited buyout offer from Vintage Capital Management, which has a controlling interest in competitor Buddy's Home Furnishings.

The board also said it had formed a special committee of independent outside directors who will "carefully review and evaluate the letter from Vintage and will provide its recommendation to the board in due course."

Vintage is headed by Brian Kahn, a former Aaron's franchisee.

Aaron's said Kahn and Vintage have made several "unfunded and unspecific non-binding proposals to acquire Aaron's" in recent years, and said several board members and members of Aaron's management have previously met with Kahn to listen to his proposals.

The most recent Vintage offer was for $30.50 per share, or about $2.3 billion.

One key change to Aaron's bylaws makes it more difficult for shareholders to call for a special shareholders meeting. Such meetings now require a demand from stockholders representing at least two-thirds (66 2/3%) of the company's shares - up from 25%.

The bylaws also were changed to allow the board to shrink the number of directors to three. Previously, bylaws required at least 11 directors.

Prior to the bylaw change, the board had nine directors and two vacancies, but the two vacant positions were eliminated.

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