Birmingham, Ala.-based Vulcan, which also reported better-than-expected fourth quarter sales of $614.6 million, said the moves, once completed, would leave its board "with flexibility to restore a competitive dividend." The company lost 20 cents per share during the fourth quarter from continuing operations, compared to a 36 cent per share loss in the year-earlier period, which also beat analyst expectations.
Martin Marietta, of Raleigh, N.C., went public with its tender offer for Vulcan last month after 18 months of fruitless negotiations. The suitor last month nominated five candidates to Vulcan's board, and has won backing for its plan from some prominent Vulcan shareholders, including hedge fund Southeastern Asset Management Inc., the third-largest holder of Vulcan shares.
Vulcan has rebuffed the bid as undervaluing the company, and on Thursday argued that shareholders would be better served if it continues as an independent. "We remain intensely focused on delivering value and accelerating our profit growth by further improving our operating leverage, reducing overhead costs, strengthening our credit profile, and restoring a meaningful dividend," company chairman and CEO Don James said in a statement. "Our focus on improving product line earnings through price and cost leadership, and the execution of the profit enhancement plan we are announcing today, position us for stronger performance in 2012."
Vulcan said proceeds from the asset sales, which will be spread out over the next 12 to 18 months, will be used to pay down debt and strengthen its balance sheet. The company reported long-term debt of $2.68 billion as of Dec. 31.
Martin Marietta and Vulcan appear to be digging in for what could be a drawn-out takeover battle. Vulcan has warned a deal would face intense antitrust scrutiny, an opinion that was seemingly reinforced earlier in the week when Martin Marietta entered into an agreement with the Department of Justice not to seek to close the transaction until at least mid-August.
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