McMoRan Exploration Co. and Plains Exploration & Production Co. were sued in separate actions by investors who claim they’ll be shortchanged in sales to Freeport-McMoRan Copper & Gold Inc. valued at more than $10 billion.
Joel Krieger, seeking to sue on behalf of all McMoRan common stockholders, contends that the oil and natural gas company’s board violated its duty to get a better price in the $3.4 billion transaction.
“The proposed buyout is unfair,” Krieger said in a complaint filed today in Delaware Chancery Court in Wilmington. He asked a judge to stop the deal under its present terms and to award damages and legal fees.
Dennis Rice contends Plains Exploration, another oil-and-gas company, is worth more than the approximately $6.9 billion in cash and stock shareholders are being offered by Freeport
“Freeport will acquire all of the outstanding stock of Plains for grossly inadequate consideration,” Rice said in his Chancery lawsuit.
Freeport, based in Phoenix, said in a statement Dec. 5 that it would buy New Orleans-based McMoRan for $14.75 a share and 1.15 units of a royalty trust. Freeport separately is buying Houston-based Plains Exploration for $25 in cash and 0.6531 share of Freeport for each Plains share, according to court papers.
David Joint, a McMoRan Exploration spokesman, and Hance Myers, a Plains Exploration spokesman, didn’t immediately respond to phone and e-mail messages seeking comment on the lawsuits.
The cases are Krieger v. McMoRan, CA8091, and Rice v. Plains, CA8090, Delaware Chancery Court (Wilmington).