Defence contractor TRW lobbied its shareholders to reject a hostile takeover bid by Northrop Grumman Corp. Monday ahead of a critical May 3 shareholder meeting.
The Cleveland, Ohio-based company, known for its lasers used in anti-missile systems, urged shareholders to vote against a proposal that would allow Los Angeles-based Northrop to launch a full takeover bid.
Northrop’s 53 dollar per share offer is “inadequate, highly conditional and below TRW’s current market price,” TRW’s board of directors said in a statement.
TRW stock was trading at 54.57 dollars per share in afternoon trading Monday, close to its 52-week high of 54.98. TRW shareholders will vote Friday on a proposal that would allow Northrop to get around a poison pill provision in Ohio law aimed at checking hostile take-overs.
Meanwhile, TRW said Friday it had signed confidentiality agreements with several other potential suitors interested in examining its books, as it seeks alternative ways of enhancing shareholder value.
Northrop was invited to participate in TRW’s process, “but, to date, has declined to do so,” the company said Friday.
TRW is also considering spinning off its auto parts business as part of the effort to fend off the hostile bid.
