Real Estate
Home›Real Estate›Industry›Better Home and Finance adopts poison pill to block ta…
Better Home and Finance adopts poison pill to block takeover at 15%
The limited-duration shareholder rights plan triggers if any investor reaches 15% ownership or voting power, and it is set to run until Better’s 2027 annual meeting.
Better Home and Finance Holding Co. adopted a limited-duration shareholder rights plan, or poison pill, aimed at deterring former CEO Vishal Garg and a group of investors from taking control of the AI-focused mortgage lender without paying what the company views as a proper control premium. The plan, announced Thursday, is designed to make an acquisition or control bid more difficult by diluting any acquiring party’s stake.
Under the terms described by HousingWire, the rights plan triggers if any person or group becomes the beneficial owner of 15% or more of any class of Better’s common stock, or 15% or more of the company’s total voting power. If triggered, remaining shareholders can buy additional Better shares at a substantial discount, reducing the takeover party’s ownership.
The company said it will distribute one Class A right for each share of Class A common stock, one Class B right for each share of Class B common stock, and one Class C right for each share of Class C common stock, with a recorded date for the distribution of Aug. 31. Better’s special committee approved the plan, and it took effect immediately.
Better said the poison pill is in response to efforts by Garg and an undisclosed group of investors described as acting together to obtain abrupt control without paying a control premium or properly informing public shareholders of their arrangements and intentions. Better noted the plan does not stop Garg from pursuing a proxy fight or making offers, and it will stay in place until Better’s 2027 annual meeting unless the board redeems, exchanges, or terminates it earlier.