The move came two days after the activist investor Carl Icahn told The Wall Street Journal he owned almost 10% of Occidental’s stock.
The Houston company’s board adopted a limited duration stockholder rights plan. Such plans are designed to make a hostile takeover prohibitively expensive.
Occidental stockholders will vote on the proposed poison pill at the 2020 annual meeting.
The plan "is intended to enable all stockholders to realize the long-term value of their investment in Occidental,” Vice Chairman Jack Moore said in a statement.
"We adopted the rights agreement to protect stockholders from efforts to capitalize on recent market volatility and macroeconomic conditions to gain control of the company without paying all stockholders an appropriate premium for that control."
Icahn was displeased with Occidental’s $38 billion acquisition of Anadarko Petroleum last year. He wants to push out Occidental Chief Executive Vicki Hollub, who spearheaded the takeover.
Occidental’s market capitalization has plummeted to $11.3 billion from more than $46 billion just before the deal was agreed upon in May, amid the oil industry’s slump.
At last check, the company’s shares traded at $12.34, up 3.8%.
Over the past year, Occidental’s stock has dropped 81% compared with an 8.5% decline for the S&P 500.