Federal Judge Allows Wallace To Use Anti-Takeover Poison Pill
WILMINGTON, Del. (AP) _ A federal judge ruled Monday that Wallace Computer Services Inc. can use an anti-takeover defense in attempting to block a $1.38 billion hostile offer from Moore Corp.
In an 82-page decision, U.S. District Judge Murray Schwartz in Delaware said Toronto-based Moore failed to prove the Wallace board acted improperly in initiating a so-called ``poison pill″ anti-takeover defense, which would make buying Wallace shares prohibitively expensive.
Schwartz also dismissed a counterclaim by Wallace, based in Hillside, Ill., alleging that a Moore-Wallace merger would violate antitrust laws.
Wallace, an accessories, business forms and supply company, has been fighting a buyout from Moore. Wallace rejected the sweetened $1.38 bid from Moore in October, calling it inadequate.
Wallace has scheduled a shareholder meeting for Dec. 8.
Moore wrote Wallace shareholders last week, seeking to have 80 percent of all shares voted in favor of a merger and to replace the current eight-member Wallace board with five _ three being representatives for Moore. Moore, a global business forms company, also is seeking a shareholder vote to remove the poison pill defense.
Moore said in early November that 73.5 percent of Wallace’s shares had been tendered to Moore for $60 each.
Wallace’s stock price was trading at $58.12 1/2 on Monday, up 25 cents on the New York Stock Exchange.