CB approves Shaw deal; next hurdle comes Friday

CB&I shareholders approved the acquisition of The Shaw Group on Tuesday, with holders of more than 90% of the company’s shares voting in favor. The deal, valued at $3.04 billion in cash and stock, could close in the first quarter of next year if Shaw’s shareholders approve it Friday. While most observers see approval as all but a done deal, Shaw isn’t taking any chances, as it needs approval from holders of 75% of the company’s common stock, excluding owners of more than 5%, and a majority of those attending a Friday 9 a.m. special meeting. Some shareholders say they’re receiving phone calls reminding them to vote. For his part, Shaw Chairman and CEO Jim Bernhard is urging shareholders to “immediately vote each and every proxy card received.” Even if the deal is approved, shareholders who file an objection to the deal before the Friday meeting and follow proper procedures can opt into a class action suit seeking what they consider fair value for their shares. However, the objecting stockholders would have to put their shares in escrow and would have no guarantee of winning a higher value. Through a recent settlement of a shareholder suit, Shaw released two analyses by Morgan Stanley (read the SEC filing here) that plaintiffs’ attorney David Wissbroecker says provides investors new information about the options Shaw’s board analyzed before reaching the agreement with CB&I. Settling the suit makes the information public, helping investors examine the transaction while setting aside any personal allegations against any top executives, he says. —David Jacobs