Seeking to keep one immensely rich activist in particular at bay, Foot Locker (NYSE: FL) announced the temporary adoption of a shareholder rights plan, otherwise known as a "poison pill," to guard against a takeover attempt. Alarm bells sounded when the company realized Vesa Equity Investment had progressively bought up a 12.2% stake in Foot Locker, with the most recent purchase, on Dec. 4, snapping up 153,730 shares.

Vesa Equity is a holding company owned and controlled by Daniel Kretinsky, a Czech billionaire lawyer who is an aggressive, well-known activist investor, dubbed "the Czech sphinx." Kretinksy has gained controlling or significant interests in companies across Europe. He also grabbed a 5.35% stake in the Royal Mail, the U.K.'s postal service, and bought up 5% of U.S.-based retailer Macy's stock back in May.

Image source: Getty Images.

The rights plan Foot Locker adopted today is a poison pill arrangement aimed at keeping Kretinksy at bay. The plan lasts a full year, expiring on Dec. 7 of 2021, and should reduce "the likelihood that any person would gain control of the Company through open market accumulation or other tactics."

All shareholders received one "right" per share of common stock they hold. The "rights" only become exercisable if any entity acquires a 20% stake in the company. At that point, holders of the "rights" can use them, paying an exercise price to gain twice that amount in common stock shares. This will effectively allow other shareholders to dilute Kretinksy's stake by buying large numbers of additional shares if he crosses the 20% threshold.

Foot Locker's share price has climbed back to pre-pandemic levels in recent weeks. During the recent third-quarter earnings conference call, the company's executives revealed year-over-year gains of 7% for EPS, 112% for net income, and 50% in e-commerce sales.

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