DETROIT — American Natural Resources Co. and Houston-based Coastal Corp. officials abruptly changed course Wednesday, undertaking discussion of a $2.4-billion friendly merger of the two energy companies.
The companies said in a joint statement that they were "engaged in serious negotiations involving a possible business combination pursuant to which shareholders of ANR will receive $65 per share in cash. There can be no assurance a definitive agreement will be reached between the two companies."
The statement was released as ANR directors met to consider their response to an unsolicited $60-per-share, $2.2-billion takeover bid by Coastal.
Neither company would elaborate on the statement.
Lawsuits between the two companies stemming from the original takeover bid are pending in U.S. District Court in Detroit.
Directors met for about six hours Wednesday. Corporate sources said ANR's management was seeking assurances from Coastal that a merged company would not move its operations from Michigan.
ANR said an announcement this morning concerning the outcome of the negotiations was possible although not certain.
The board meeting had been twice postponed, and Tuesday ANR Chairman Arthur R. Seder Jr. and Coastal Chairman Oscar S. Wyatt Jr. met in Detroit to discuss Coastal's offer.
Asked if Wyatt would meet with the board, ANR spokesman Jim Bailey said: "I cannot comment on anything at all for Oscar Wyatt or our board beyond what we've said."
Wyatt was registered Wednesday at the Pontchartrain Hotel near ANR's headquarters in Detroit, but a person answering his phone would not pass calls through to him.
ANR President William T. McCormick Jr. and Coastal President James R. Paul also were present at Tuesday's meeting, ANR said.
ANR Stock Trading
The ANR board has said it may reach a position by Friday on the Coastal takeover offer, Bailey said.
ANR stock remained among the most heavily traded on the New York Stock Exchange as investors sold to cash in on the shares' already substantial rise in price.
There were 2.8 million shares traded Wednesday, as the price of ANR stock dropped 75 cents to $61.25 per share.
One New York investor, Ivan F. Boesky, had acquired 9.9% of ANR's 37.2 million shares, spokesman John Guenther said. Boesky bought the stock for investment purposes, Guenther said.
ANR earlier this week said strategies considered by its directors would include using the company's assets as collateral to raise the money to buy its own stock, thereby keeping it out of Coastal's grasp, and seeking a friendly arrangement with a third company.
The meeting of the two chairmen fueled speculation that Coastal was prepared to increase its offering price in return for ANR's acquiescence to the takeover.
"That's rank speculation by somebody," said Robert W. Wells, Coastal spokesman in Houston. "I cannot confirm or deny it. To the best of my knowledge, nobody that was in the meeting has spoken of it"
ANR's Bailey declined to comment on the matter.
Coastal announced its offer for ANR's common stock March 4. Shareholders who agree to sell their shares to Coastal have until March 22 to change their minds, and Coastal's offer expires March 29.