Live Entertainment Plans ‘Poison Pill’ Defense

Live Entertainment, a Van Nuys home video and recorded music distributor and retailer, adopted a common takeover defense known as a “poison pill.”

Under the plan, Live shareholders will be given rights to purchase additional shares in the company at a discounted price if a party acquires 20% or more of Live’s stock. The object of the plan is to make a takeover of the company prohibitively expensive, forcing a suitor to negotiate with Live’s board before attempting a takeover.

Live said that the poison pill would not be triggered by stock purchases by Carolco Pictures Inc., the film producer that owns 48% of Live, or Carolco’s chairman Mario F. Kassar. It also said the plan was not adopted in response to any takeover attempt.

Live’s stock, which plummeted to $13.375 per share last fall after reaching a high of $25 before the death last summer of its chairman, Jose Menendez, has rebounded to about $22 a share recently.