Shaw shareholders win expanded appraisal rights in settlement

Shaw Group shareholders who vote against the pending merger with the Chicago Bridge & Iron Co. on Friday will have the right to an independent judicial determination of the fair value of their shares—and be compensated on that basis if the merger is approved—according to a settlement announced Monday by two law firms representing plaintiffs in the class action suit, Robbins Geller Rudman & Dowd LLP, and Motley Rice LLC. Typically, under Louisiana law, dissenters would only have such rights if the merger were approved by less than 80% of Shaw’s total voting power. Through the same settlement, Shaw disclosed new analyses, prepared by Morgan Stanley, which says Shaw’s common stock could theoretically be worth an additional $7 to $19 per share—under various scenarios, alternatives and assumptions—above the $46 in cash and stock already being offered in the deal valued at $3.04 billion in cash and stock. Shareholders are set to vote on the merger Friday morning, and holders of at least 75% of the company’s common stock must vote in favor in order for the merger to be approved. The Shaw Group and an attorney with the plaintiffs’ firm could not immediately be reached for comment this morning.