Local Opposition to Acquisition Prompts Nimble Legislative Action

Some transactions go smoothly. But when they don’t, Verrill Dana is ready. The proposed acquisition in 2000 of a publicly traded company in Maine by large multinational corporation was just such a transaction.

For months, the multinational corporation and its legal team had worked to prepare the necessary tender offer materials and othe SEC filings in support of the proposed acquisition. But at 5PM during one evening in April, everything changed. Verrill Dana’s corporate group received word from the firm’s government relations team that emergency legislation had been filed by the Governor, with support from Legislative leadership, that would scuttle the transaction -- if passed. The bill had already been scheduled for hearing the following morning, with no advance notice. So we swung into action immediately.

Working all night, our team formulated a strategy for the public hearing, and in the morning, we implemented an all-out government relations strategy to slow down the legislative process and give our client more time to tell their story – and complete the transaction. The strategy worked, and by a narrow vote in the Maine House that night, the bill failed to get the necessary votes to pass. But our work was not over.

For the next two weeks, working closely with the client, elected officials, and media consultants, Verrill Dana helped the client continue forward with the proxy battle and grow support within the Legislature to reject the proposed bill. The work was not easy because there was strong emotional support within the local community to prevent the transaction. But we were able to make headway by illustrating that political interference with private business transactions would hurt Maine’s business climate in the long run, and should be discouraged.

Finally, in May, after weeks of intense work and substantial media coverage, the Legislature took a final vote on the bill. By a single vote in the Senate, our argument won the day, and the bill failed. With the failure of the bill, the transaction was able to move forward to completion with the support of the shareholders. Crisis averted.