Shareholders: Profits Over Safety, No Way

Friday, May 27, 2011 @ 01:05 PM gHale

Massey Energy Co. wants to sell its company to Alpha Natural Resources, but Massey shareholders are saying not so fast because they feel the company’s directors placed profits over safety and they should be held accountable for the mine disaster that left 29 dead.

The shareholders said if the $7 billion deal closes, their claims will be lost, and the Massey directors will escape responsibility for leaving the company so damaged they were forced to sell it to Abingdon, Va.-based with by Alpha at a discount.

“Alpha in no way is going to pursue these claims,” shareholders’ attorney Stuart Grant told Delaware court Vice Chancellor Leo Strine Jr. in arguing for a preliminary injunction to delay the merger.

Attorneys for Massey and Alpha urged Strine to allow stockholders to vote on the merger June 1 and said Alpha can decide later whether it would be in its best interests to pursue claims against the Massey directors.

“The Alpha board is precisely capable of making those decisions,” said attorney Mitchell Lowenthal.

Kevin Abrams, an attorney for Massey and its directors, defended the proposed merger and rejected the plaintiffs’ arguments that the company failed to get the best deal it could.

“We’ve got a very substantial premium and a great deal for stockholders,” he said.

An independent investigator issued a report on the April 2010 explosion at the Upper Big Branch mine near Montcoal, W.Va. The report said Massey Energy leaders fostered a business environment in which coal production was valued more highly than workers’ safety.

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