Hedge Fund Settle Washington Group Lawsuit

Oct 19 2007 | 12:36pm ET

A New York hedge fund has settled their lawsuit with engineering and construction concern Washington Group International over the Boise, Idaho-based company’s proposed sale.

Purchase, N.Y.-based Schultze Asset Management had sued to stop the $2.6 billion takeover by URS Corp., alleging that Washington Group and its board of directors “breached their fiduciary duties because they failed to choose financial projections that fairly valued the company’s worth to maximize shareholder value.”

Earlier this week, proxy advisor Institutional Shareholders Service advised owners of Washington Group stock to vote against the deal—which prices the company at $90 per share, while it was trading at more than $93 in midday trading today—while Washington Group continues to push for the deal.

Under the terms of the settlement, Washington Group has agreed to provide shareholder with supplemental disclosures.

Schultze holds a roughly 3% stake in Washington Group.

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