Marietta Seeks Clarity in Deal Terms - Analyst Blog
December 16 2011 - 11:12AM
Zacks
Earlier this week, Martin Marietta Materials,
Inc. (MLM) announced that it will commence an unsolicited
exchange offer to acquire all the outstanding shares of
Vulcan Material Company’s (VMC) common stock at a
fixed exchange ratio of 1:2. More specifically, as per the exchange
offer, each of Vulcan’s common stockholders will receive 0.50
shares of Martin Marietta common stock.
However, soon after the announcement, Martin Marietta filed a
litigation in the Delaware Court of Chancery seeking a declaration
that the non-disclosure agreement between the two companies signed
on May 3, 2010, does not prohibit Martin Marietta to purchase all
issued and outstanding shares of Vulcan common stock in exchange
for Martin Marietta’s common stock as well as the company’s
proposal of nominating five independent members to the Vulcan’s
board of directors.
As a result, institutional investors have hired the law firm
Wolf Haldenstein Adler Freeman & Herz LLP to investigate the
circumstances surrounding the non-disclosure agreement between
Vulcan and Martin Marietta. Vulcan’s board of directors has also
decided to review the proposal and determine the course of action
in order to maximize the interests of the company as well as its
shareholders.
Based in Birmingham, Alabama, Vulcan is engaged in the
production, distribution and sale of construction aggregates, and
other construction materials and related services in the U.S. and
Mexico. It is the nation’s largest producer of construction
aggregates and a leading producer of other construction
materials.
In the most recent quarter, Vulcan incurred an adjusted loss of
$41 million or 13 cents per share from continuing operations
compared with $11 million or 8 cents per share in the prior-year
quarter. Total revenue increased marginally to $760.8 million from
$743.2 million in the year-ago quarter.
Raleigh, North Carolina-based Martin Marietta produces and sells
aggregates for the construction industry primarily in the United
States, Canada, the Bahamas, and the Caribbean Islands. The
company’s has a wide customer base extending from public
infrastructure, and nonresidential and residential construction
industries to agriculture, railroad ballast, chemical, and other
applications.
MARTIN MRT-MATL (MLM): Free Stock Analysis Report
VULCAN MATLS CO (VMC): Free Stock Analysis Report
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