Forward Air-Omni Logistics takeover dispute continues
24 / 11 / 2023
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The ongoing legal battle between Forward Air and Omni Logistics over a takeover deal struck between the firms in August has continued in recent weeks.
The most recent development in the ongoing dispute is that Forward Air has filed a counterclaim against Omni’s lawsuit, which aims to enforce the merger between the two firms.
On November 10, Forward Air filed its response to Omni’s lawsuit as well as the counterclaim for declaratory relief.
Forward alleges that Omni has not complied with certain of its obligations of the merger agreement and would therefore like to see the agreement cancelled.
“Because of Omni’s continuous delays and repeated misrepresentations, Forward no longer believes Omni to be acting in good faith with respect to the merger agreement.
“Consequently, Forward 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.”
Forward is seeking an order from the Delaware Court of Chancery declaring that it is not obligated to close the transaction and that it is entitled to terminate the merger agreement.
Omni, meanwhile, is trying to force the deal through.
In response to the counterclaim, Omni said: “Omni categorically denies the claims made in Forward Air’s Counterclaim. Omni has complied with all the required provisions of the agreement and plan of merger between Omni and Forward Air.”
It added: “Omni believes the Merger Agreement is legally binding and intends to enforce the Merger Agreement and close the transaction as expeditiously as possible.”
The company is seeking a judicial declaration confirming that it has complied with all required provisions of the merger agreement and has requested a trial before the Court of Chancery to obtain a ruling enforcing the merger agreement.
Omni has also issued an open letter to the shareholders of Forward Air that stressed the merger would increase business prospects and reduce costs. The company said the merger would create “an all-in-one expedited LTL partner”.
“Omni believes Forward Air’s threat to terminate the transaction is unenforceable under our binding contractual agreement – and we are confident that no impediment exists to closing the transaction immediately,” claimed the company in the letter.
The issues come after certain shareholders of Forward obtained a temporary restraining order related to the deal earlier this year.
However, in October, the restraining order was dissolved by the Third District Chancery Court sitting in Greeneville, Tennessee.
Following this, Omni launched its lawsuit in late October.
Omni Logistics is a global multimodal provider of air, ocean and ground services. Forward Air is a provider of transportation services across the US, Canada and Mexico
