Takeover Opposed By Hedge Funds Falters

Oct 30 2007 | 2:43pm ET

Engineering and construction concern Washington Group International has postponed a vote on its proposed takeover by URS Corp. to build support for the hedge fund-opposed bid.

URS’ $2.6 billion offer for Washington Group has been slammed by activist hedge funds for undervaluing the target. Greenlight Capital, which owns 10% of Boise, Idaho-based Washington, has said it will vote against the deal, while Purchase, N.Y.-based Shultze Asset Management had sued to preempt the deal. Shultze, which owns 3% of Washington, settled its lawsuit earlier this month, after Washington agreed to provide supplemental disclosures to shareholders.

Influential proxy adviser Institutional Shareholder Services has also inveighed against the bid, urging Washington shareholders to vote no.

Yesterday, Washington admitted that it did not receive enough support, and postponed the vote, set for today, until Nov. 9.

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