SAN DIEGO--(BUSINESS WIRE)--Robbins Geller Rudman & Dowd LLP (“Robbins Geller”) and Motley Rice LLC (“Motley Rice”) announced today that, on behalf of their clients, they have entered into a Memorandum of Understanding to resolve all claims (the “Settlement”) in In re The Shaw Group, Inc. Shareholder Litigation, Lead Case No. 614399, pending before the 19th Judicial District Court for the Parish of East Baton Rouge, State of Louisiana (the “Court”).
“a discounted cash flow analysis of Shaw prepared by Morgan Stanley, which illustrated that exercising NEH’s put options to sell its investment in Westinghouse could result in an additional $7.00 to $16.43 of theoretical intrinsic value per share of Shaw common stock, based on various assumptions and scenarios”
For shareholders of The Shaw Group, Inc. (NYSE:SHAW) (“Shaw” or the “Company”), the Settlement offers unprecedented relief in the form of a class-wide, opt-in appraisal right for all Shaw shareholders who vote against the proposed merger between Shaw and Chicago Bridge & Iron Company N.V. (“CB&I”) and take the necessary steps to perfect their appraisal rights.
The Settlement has two components. The first component is Shaw’s agreement to make certain additional disclosures in a Supplement to its Definitive Proxy Statement. Those disclosures, which were filed on Form 8-K with the SEC on December 13, 2012, and mailed directly to all shareholders of record and beneficial owners, include critical financial information about the Shaw Board’s assessment of various stand-alone alternatives to the proposed merger, and the analyses that the Shaw Board’s financial advisor, Morgan Stanley, conducted to assess the potential value of the those options. Specifically, the additional disclosures include disclosure of: (i) “a discounted cash flow analysis of Shaw prepared by Morgan Stanley, which illustrated that exercising NEH’s put options to sell its investment in Westinghouse could result in an additional $7.00 to $16.43 of theoretical intrinsic value per share of Shaw common stock, based on various assumptions and scenarios”; and (ii) a “preliminary analyses by Morgan Stanley, which illustrated that the cumulative estimated potential share price impact of executing a variety of possible strategic alternatives (including exercising the Westinghouse put option, and the corresponding potential negative impact on Shaw’s power segment, and a share repurchase) could be cumulatively $11.00 to $19.00 per share versus the status quo based on various assumptions.” These additional disclosures, which can be viewed in their entirety at http://www.sec.gov/Archives/edgar/data/914024/000119312512501919/d453115d8k.htm, should be reviewed in connection with the rest of the disclosures already made in Shaw’s Definitive Proxy Statement.
To enable Shaw shareholders to pursue a remedy that could provide more value if the Company is worth more than CB&I is paying for it, the Settlement contains a second component – universal appraisal rights for all Shaw shareholders who properly dissent from the proposed merger, and the opportunity for Shaw dissenters to pursue this remedy on a class-wide basis. This universal opt-in appraisal right will allow Shaw dissenters to aggregate their appraisal claims and pursue them collectively. In order to make this remedy available, Shaw agreed to significantly alter the contours of the limited appraisal remedy that would otherwise be available under Louisiana Business Corporation Law.
The contours of this class-wide appraisal remedy are explained in more detail in the same Form 8-K that set forth Shaw’s additional disclosures. Shaw shareholders should review that document, and well as the discussion of appraisal rights in the Company’s Definitive Proxy Statement, to understand what appraisal rights they now have, as well the steps that need to be taken to perfect those appraisal rights.
All Shaw shareholders that want to take advantage of this appraisal remedy must vote against the proposed merger with CB&I, and provide the Company with notice of their intent to dissent from the proposed merger in writing either by mailing such notice to Shaw at 4171 Essen Lane, Baton Rouge, Louisiana 70809, or by sending an email communication to a Company corporate representative at the following email address: email@example.com. If the notice is sent by mail, it is recommended that all required documents to be delivered by mail be sent by registered or certified mail with return receipt requested.
Please contact co-lead class counsel if you have any questions about the opt-in appraisal class and would be interested in having us represent you in connection with these proceedings.