Meadow Valley, Insight extend merger agreement; shareholder opposes renegotiation

By Lisa Kerner

Charlotte, N.C., Dec. 3 - Meadow Valley Corp. and Insight Equity I LP affiliates Phoenix Parent Corp. and Phoenix Merger Sub, Inc. agreed to extend the termination date of their merger agreement to Jan. 7 from Dec. 31.

Either party may terminate the merger agreement after that day, a Meadow Valley news release said.

The extension allows for a possible resolution of Phoenix Parent's recent claim that Meadow Valley may have suffered a material adverse effect as the result of an alleged decrease in the fair market value of Meadow Valley in excess of $6.0 million since the date of the merger agreement.

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

The merger agreement includes termination rights for both companies, with fees of $1.5 million and approximately $2.5 million payable under certain specified circumstances, it was previously reported.'

Shareholder opposes renegotiation

Meadow Valley shareholder Hoak Public Equities, LP said it will not support any renegotiation of the company's merger agreement that results in net proceeds of less than $11.25 per share.

The 5% shareholder also does not believe a material adverse effect has occurred, according to a schedule 13D/A filed with the Securities and Exchange Commission.

In a Dec. 3 letter to Meadow Valley special committee chairman Don A. Patterson, Hoak said while it was reluctant to support the original merger agreement, it is prepared to take legal action if the deal is not closed under the already agreed upon terms and timeframe.

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