Meadow Valley's merger with Insight Equity affiliate fails to close on time

By Lisa Kerner

Charlotte, N.C., Jan. 8 - The proposed merger of Meadow Valley Corp. and Insight Equity I LP affiliate Phoenix Parent Corp. (now Meadow Valley Parent Corp.) was not completed by the outside closing date of Jan. 7 as required under the companies' merger agreement.

Either Meadow Valley or Meadow Valley Parent may terminate the merger agreement if the terminating party has satisfied all of its closing conditions, a Meadow Valley news release said.

Meadow Valley, which has not satisfied all of its closing conditions, said Meadow Valley Parent has not given the company any notice of termination and so the merger agreement remains in full force.

In July 2008, Meadow Valley, a Phoenix construction materials company, agreed to be taken private for $11.25 per share in cash, or a total of $61.3 million.

Approximately 71% of Meadow Valley's total shares outstanding voted to approve the merger in December, it was previously reported.

Meadow Valley Parent had claimed that a material adverse effect may have occurred due to a decrease in the fair market value of Meadow Valley in excess of $6.0 million since the date of the merger agreement. However, Meadow Valley disagreed and said it would defend itself if Meadow Valley Parent terminates the merger agreement based on that claim.

The merger agreement includes termination rights for both companies, with fees of $1.5 million and $2.5 million payable under certain circumstances, according to a prior news release.

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