Forward Air (NASDAQ:FWRD) jumped over 4% higher in pre-open trading Thursday after the company said it is considering exercising its right to terminate its merger with Omni Logistics.
Shareholders of the trucking company, including Ancora Holdings, have come out aggressively against the deal with the stock dropping precipitously since announcing the deal in August. In September, three retired Forward Air executives and current shareholders filed a lawsuit to block the deal.
The company stated today that while a judge ordered that an ex parte temporary restraining order related to the merger obtained by the shareholders be dissolved, it believes that Omni "has not complied with certain of its obligations under Sections 7.03 and 7.14 of the Merger Agreement."
Because of this, Forward Air believes "the closing condition contained in Section 8.02(b) of the Merger Agreement will not be satisfied at the anticipated closing of the transactions under the Merger Agreement, and Forward will not be obligated to close."
Omni, for its part, said it has "fully complied with all the required provisions of the Agreement and Plan of Merger." and said the merger is "legally binding" and intends to enforce it.
Ancora said it believes Forward Air’s stock can move back to $100 over the next six months if shareholders vote against the deal and the board and management are replaced. They believe Forward Air’s value creation opportunity is $140-$145 per share.