Tempur Sealy International Inc. said Thursday it has adopted a stockholder rights plan, a tactic often used by companies to stave off a hostile takeover. The news comes just weeks after the mattress company's stock suffered its biggest one-day selloff in nearly nine years on the news that it had terminated all contracts with major customer Mattress Firm. That came after Mattress Firm and its South African owner Steinhoff International demanded significant changes to supply agreements. With its stock so low, Tempur Sealy could become a target for an interested buyer. Under the rights plan, the company is distributing one right for each outstanding share as a dividend on Feb. 20. The company said the plan "is intended to protect Tempur Sealy and its stockholders from the actions of third parties that the Board of Directors determines are not in the best interests of Tempur Sealy and its stockholders, and to enable all stockholders to realize the long-term value of their investment in Tempur Sealy." Shares were slightly higher in premarket trade, but have lost 20% in the last 12 months, while the S&P 500 has gained 24%.
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