UPDATE 2-Barnes & Noble shareholders OK anti-Burkle pill

* Measure is valid for two years

* 72 percent of votes cast in favor of the poison pill

* Burkle gets little support in voting against the pill

* Shares up 2.2 percent
(Adds chairman’s comment, analyst comment, background, updates
share movement)

By Phil Wahba

NEW YORK, Nov 17 (BestGrowthStock) – Barnes & Noble Inc (BKS.N: )
shareholders voted overwhelmingly in favor of ratifying a
“poison pill” put in place last year to ward off any potential
takeover by dissident shareholder Ron Burkle.

Chairman and founder Leonard Riggio said at a special
meeting in New York on Wednesday that preliminary results
showed 72 percent of the votes cast supported the shareholder
rights plan, as the “poison pill” is formally known.

The measure, which will be valid for the next two years,
was put in place a year ago, when Burkle’s Yucaipa Cos doubled
his stake in the top U.S. bookstore chain in a matter of days.

“It shows support for the company — finally we have this
behind us and we can go about the business of running the
company,” Riggio told Reuters in an interview after the
meeting.

The poison pill limits any shareholder, except for Riggio,
who is grandfathered, from holding 20 percent or more of the
company.

Last month, Barnes & Noble limited the ability of Riggio
and his family to increase their stake, addressing a criticism
by Burkle that the poison pill favored Riggio. [ID:nN29227624]

Yucaipa is the retailer’s second-largest shareholder, with
a stake of about 18.8 percent, after Riggio, who owns about 29
percent. Burkle, who did not solicit votes against the pill,
lost a bitter proxy fight in September, failing to win a seat
on its board.

Barnes & Noble has said the pill is needed to keep Burkle
from working in conjunction with Aletheia Research and
Management Inc, the third-largest shareholder, to take over the
company without paying shareholders an adequate premium after
Aletheia raised its own stake last year in Barnes & Noble.

But a source familiar with the matter told Reuters that
Aletheia, which on Monday said in a filing it had lowered its
stake in Barnes & Noble to 14 percent from 15 percent, voted in
favor of the pill. That means that excluding his own shares,
Burkle garnered very little support from other shareholders.

Representatives for Burkle did not immediately respond to a
request for comment. Burkle is appealing a Delaware court
decision last August which upheld the pill.

The retailer has contended with a long decline in physical
books sales and in August put itself up for sale. In recent
weeks, it has launched a well-reviewed update of its Nook
e-reader and begun testing toy boutiques within its stores.

With the Burkle fight all but over for at least two years,
keeping the poison pill in place should give Barnes & Noble
some breathing room to re-engineer its business, an analyst
said.

“The structural issues involved in day-to-day are still
ongoing — on the fringe gives them comfort shareholders are
supporting their view,” said Morningstar analyst Pete
Wahlstrom.

Barnes & Noble shares were up 2.2 percent at $14.73 in
morning trading.
(Reporting by Phil Wahba; Editing by Lisa Von Ahn and Matthew
Lewis)

UPDATE 2-Barnes & Noble shareholders OK anti-Burkle pill