On June 28, L.B. Foster Company (Nasdaq: FSTR) announced that the Court of Common Pleas of Allegheny County, Pa., had dissolved the preliminary injunction issued on April 21, 2010, that had enjoined the completion of L.B. Foster's tender offer for all of the common stock of Portec Rail Products, Inc. (Nasdaq: PRPX).
"We are pleased that this obstacle to L.B. Foster's acquisition of Portec has been removed," said Stan L. Hasselbusch, L.B. Foster's CEO.
Another hurdle has arisen, however. The company also announced that the U.S. Department of Justice had informally raised antitrust concerns regarding the proposed acquisition of Portec. As a condition of acquisition, the DOJ may request restructuring, and the alternatives may include the sale of some assets associated with the merged company's rail business. Hasselbusch said that L.B. Foster is evaluating the matter.
On February 16, 2010, L.B. Foster and its wholly owned subsidiary, Foster Thomas Company, entered into an Agreement and Plan of Merger with Portec. Pursuant to the merger agreement, L.B. Foster, through its subsidiary, commenced a tender offer for all of Portec's common stock at a price of $11.71 per share. The tender offer currently is set to expire on July 30, 2010. It is subject to all necessary antitrust clearances under the Hart-Scott-Rodino Antitrust Improvements Act of 1976.