A federal appeals court in Cincinnati yesterday gave Mobil Corp.. its first break in several weeks in its attempt to acquire Marathon Oil Co.
The court delayed the date on which Mobil's rival, U.S. Steel Corp., may begin buying Marathon shares, taking away the steel company's crucial advantage in timing.
The court said yesterday that neither Mobil nor U.S. Steel may buy Marathon shares until five days after an appelate court rules on two key issues in the takeover fight. Until the court intervened, U.S. Steel had been set to begin buying Marathon stock after midnight Monday.
The fight could have ended at that point with U.S. Steel in control of the stock and the legal issues still pending.
A Mobil spokesman said yesterday that the company was pleased with the ruling. "If we hadn't gotten this order, it would have all been over at midnight Monday," noted Mobil's lawyer, John Elam.
In a related development, the Federal Trade Commission filed suit in federal court in Cleveland to enjoin Mobil's bid for Marathon.
The takeover battle began Oct. 30, when Mobil offered $85 a share for 51 percent of Marathon's stock. U.S. Steel and Marathon later reached an agreement for U.S. Steel to take over the smaller oil company for an estimated $6.25 billion. Mobil countered with a $6.5 billion offer and a lawsuit challenging two key parts of the Marathon-U.S. Steel agreement.
Mobil lost that legal challenge in a preliminary round. It also failed to defeat a legal challenge to its bid by Marathon, which said Mobil's takeover attempt violated antitrust law.
The 6th Circuit Court of Appeals said yesterday that it would hear oral arguments on Mobil's two appeals of those decisions on Thursday.
Neither U.S. Steel nor Marathon had any comment on the court's extension of the withdrawal date for the U.S. Steel offer.