“Apple Inc. said it will fight Greenlight Capital Inc.’s bid to bar the company from adopting a measure restricting its ability to issue preferred stock.
The maker of iPhones and MacBooks filed a response yesterday in U.S. District Court in New York to the request made by Greenlight in its lawsuit.
“The proposed injunction would harm the public interest,” and should be denied, Apple said in the filing. The measure “gives common shareholders greater power — the right to approve issuance of preferred shares,” Apple said.
Greenlight founder David Einhorn has said the tech company should issue high-yielding preferred stock to provide more value to shareholders from a $137 billion stockpile of cash. The measure up for vote would eliminate “Apple’s power to issue preferred stock,” Greenlight said in the company’s complaint.
The hedge fund claimed Cupertino, California-based Apple unfairly grouped the preferred share measure with other matters to be voted on at a meeting Feb. 27, violating the U.S. Securities and Exchange Commission “unbundling rules.”
Apple said in its filing that it’s not violating SEC rules and that the move only eliminates so-called “blank check” preferred stock provisions. Without the provisions, preferred shares could still be offered as long as investors approve the change, according to Apple.
