On May 31, the Delaware Supreme Court, after an expedited appeal, affirmed the Court of Chancery’s May 4 decision inMartin Marietta Materials v. Vulcan Materials, C.A. No. 7102 (Del. Ch.), enjoining plaintiff-counterclaim defendant Martin Marietta Materials from continuing to pursue its exchange offer and proxy contest to acquire defendant-counterclaim plaintiff Vulcan Materials. The Supreme Court issued its opinion,Martin Marietta Materials v. Vulcan Materials , No. 254 (Del.), explaining its judgment on July 10. For practitioners negotiating or enforcing nondisclosure agreements in sale transactions, this opinion provides useful guidance.

The dispute arose from unsuccessful merger negotiations between Martin Marietta and Vulcan, the largest domestic participants in the aggregates industry. Since the early 2000s, Vulcan and Martin Marietta had occasionally discussed a possible business combination. After Ward Nye became CEO of Martin Marietta in 2010, Vulcan and Martin Marietta restarted merger talks, according to the opinion. Nye was receptive to a possible merger because the financial crisis had negatively affected Vulcan more than Martin Marietta and because Vulcan’s CEO was approaching retirement age with no clear successor.

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