A group of Massey Energy investors are looking to block the largest coal miner in Central Appalachia from selling itself to rival Alpha Natural Resources just days before Massey shareholders are expected to approve the deal. A group of Massey investors have asked the West Virginia Supreme Court of Appeals to block the $7.1 billion sale to Alpha Natural, according to the Wall Street Journal.
Virginia-based Alpha Natural (ANR) announced the deal to acquire Massey in January after weeks of speculation by analysts and investors that Massey was primed to be a acquired. The investors looking to block the sale allege that Massey's management team agreed to the sale to avoid personal liability for the April 2010 explosion at the company's Upper Big Branch mine in West Virginia that killed 29 workers.
Massey (MEE) is also facing a separate suit brought by the New Jersey Building Laborers Pension Fund, which also seeks to halt the sale, the Journal reported. Massey shareholders were scheduled to approve the deal on Wednesday.
Both the New Jersey and West Virginia suits were filed in 2010. Attorneys for the plaintiffs in West Virginia allege that Massey gave Alpha Natural preferential treatment in the bidding process, but Alpha Natural has denied that allegation. Plaintiffs include the California State Teachers' Retirement System, the Journal reported.