PRPL - Purple Innovation fires off poison pill hires special committee in reaction to takeover bid

Purple Innovation ( NASDAQ: PRPL ) announced the creation of a special committee to evaluate the takeover proposal from Coliseum Capital Management.

The firm offered on September 17 to acquire Purple Innovation for $4.35 per share in cash. Coliseum Capital already held a 45% stake in PRPL before the acquisition offer.

The special committee of independent and disinterested directors has approved the adoption of a limited-duration shareholder rights plan.

The special committee has not reached any conclusion as to the advisability or feasibility of a potential transaction at this time.

The rights plan is effective immediately will expire on September 25, 2023, unless the special committee determines to terminate the plan earlier. The record date for the rights plan is October 5, 2022. The poison pill is intended to enable the company's shareholders to realize the full value of their investment and to guard against any attempts to gain control of PRPL without paying all shareholders an appropriate control premium.

Shares of PRL fell 4.50% in premarket action on Monday to $3.82.

Truist Securities thinks other bidders will step up for PRPL.

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