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Investing.com -- PetMed Express Inc (NASDAQ:PETS) stock rose 3.4% in after-hours trading on Wednesday following the company’s announcement that it extended its shareholder rights plan by one year.
The pet medication retailer’s Board of Directors unanimously approved an amendment to the existing plan, pushing the expiration date from December 2, 2025, to December 2, 2026. All other terms and conditions of the rights plan remain unchanged.
The company stated that the Board adopted the rights plan to protect shareholder investments during a period when it believes the company’s shares "do not reflect the inherent value of the business or its long-term growth potential." The Board also noted concerns about "recent significant accumulations of Company common stock by certain shareholders."
According to the announcement, the plan is designed to enable shareholders to realize long-term value and ensure fair treatment in the event of any proposed takeover. The company emphasized that the plan doesn’t interfere with any sale, merger, or business combination approved by the Board, nor does it prevent the Board from considering offers that recognize PetMed’s full value.
The rights plan is intended to guard against tactics to gain control of the company without paying all shareholders an appropriate premium.
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