Circuit City Drops Poison Pill

Circuit City's (CC Quote) board delivered on an old promise to shareholders Wednesday, removing barriers to hostile takeover attempts at the company amid a private-equity buying spree.

After years of ignoring shareholders' requests, the company's board agreed last February to remove its so-called poison pill, which limits the number of shares that can be owned by an investor. On Wednesday, the company ordered the redemption of all outstanding preferred-share purchase rights under the company's shareholder rights plan.

"It's a good thing to do," said Colin McGranahan, an analyst with Bernstein & Co. "A lot of shareholders like to see it done. [The company is] clearly a takeover candidate, since it's had two offers in two years." ...