ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Saturday, November 2, 1996 TAG: 9611040037
SECTION: BUSINESS PAGE: A-8 EDITION: METRO
SOURCE: GREG EDWARDS STAFF WRITER
Norfolk Southern Corp. asked a federal judge in Philadelphia Friday for a temporary restraining order blocking Conrail from launching a "poison pill" defense next week against Norfolk Southern's attempt to take control of Conrail.
NS labeled Conrail's takeover defense a draconian plan that would effectively force Conrail shareholders to accept a merger offer by CSX Corp. and prevent them from considering Norfolk Southern's higher counteroffer.
The poison pill is intended to make acquisition of Conrail by any railroad other than CSX prohibitively expensive. If it's enacted Thursday, no other company would be able to merge with Conrail before 2005.
Conrail's plan, NS said in its court motion, "is the most egregious instance of a company hastily locking up a transfer of control to a favored bidder without regard for the best interests of its shareholders" or others with a vested interest in the company.
NS said Conrail, its board of directors and CSX are trying to "coerce, mislead and fraudulently manipulate Conrail's shareholders to swiftly deliver control of Conrail to CSX."
On Oct. 15, CSX and Conrail jointly announced they had reached an agreement for CSX to acquire Conrail for a combination of cash and CSX stock in a deal worth roughly $8.4billion. Norfolk Southern on Oct. 24 countered with a $100 per share cash offer for Conrail worth $9.1billion.
U.S. District Judge Donald Van Artsdalen has scheduled a preliminary hearing on the NS suit on Nov.12.
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