Delaware court sidelines takeover bid for Vulcan Materials
A hostile takeover battle between the nation’s two largest suppliers of construction aggregates -- one of the chief ingredients of concrete -- was put on a four-month hiatus by a Delaware court on May 14. Although the stay is only temporary, pending the outcome of an appeal, Martin Marietta must put a halt to its efforts to combine the two companies, which include a stock-exchange offer and an effort to elect its own directors to Vulcan’s board.
Discussions about a possible merger began in 2011 between the chief executives of Marietta Materials and Vulcan, according to regulatory filings. But the two CEOs could not agree on issues such as the executive management positions and shareholder premiums.
The all-stock offer arrived on Vulcan’s doorstep on Dec. 11 from the smaller of the two firms, Martin Marietta. Vulcan’s board recommended against the merger, and a proxy battle ensued. Vulcan now accuses Martin Marietta of using confidential information obtained during pre-merger talks to formulate its hostile bid.
Martin Marietta is the second-largest supplier of crushes stone, sand and aggregates in the United States. It also sells asphalt and concrete in certain geographic regions.
Vulcan is the country’s largest producer of construction aggregates and a major producer of other construction materials, including asphalt and ready-mixed concrete and a leading producer of cement in Florida.