Polaroid Urges Voluntary Retirements in Move to Fight Hostile Takeover
CAMBRIDGE, Mass. (AP) _ Polaroid Corp., seeking to elude a hostile takeover by Shamrock Holdings Inc., has raised to 1,500 the number of employees it wants to retire voluntarily in an effort to consolidate resources.
Company officials have also warned employees that layoffs could occur if the payroll-trimming goal is not met.
The threat of forced layoffs was made Wednesday in a speech delivered to Polaroid’s highest-ranking executives by chief executive officer I. MacAllister Booth and replayed on videotape Thursday before hundreds of marketing employees meeting in Cambridge.
″This company is like a family to me,″ said Booth. ″When my family gets attacked I fight ... and when my company gets attacked, I fight, too.″
Shamrock, a California investment firm controlled by Roy E. Disney, made an unsolicited offer July 20 to buy Polaroid. Shamrock raised its offer last Friday, but the offer was unanimously rejected Tuesday by Polaroid’s board of directors.
According to today’s Boston Globe, Shamrock has indicated it is prepared to launch a hostile tender offer if Polaroid refuses to negotiate.
On the heels of a previously announced restructing plan aimed at cutting costs and boosting profitability, Polaroid’s latest defensive maneuver includes the elimination of 500 to 800 additional people through voluntary retirement; the repurchase of $300 million in Polaroid stock, and the issuance of 10 million new shares for an employee stock ownership plan (ESOP).
The ESOP, which gives employees 14 percent control of Polaroid, has been challenged by Shamrock in a Delaware court. Shamrock opposes the plan because by voting on the side of management, employees can effectively block a takeover.
Six of the company’s 27 officers have agreed to leave, including senior vice president and treasurer Harvey H. Thayer; senior vice president of strategic planning Milton S. Dietz, and Joseph J. McLaughlin, group vice president of worldwide marketing. Three other vice presidents were also among the group.
As further incentive for early retirement, employees who leave immediately will be paid through Nov. 30.
″If that doesn’t work,″ Booth said, ″we will have to rely on layoffs.″
Recalling earlier words of assurance that apparently all but excluded layoffs, Booth told his managers, ″I didn’t expect to be in this type of warfare when I made my pledge.″