Denali Investors call for investigation of Shaw Group chairman

A New York-based investment fund that owns shares in U.S. engineering company Shaw Group has demanded that a special committee be set up to investigate Shaw's chairman for potential conflicts of interest as he looks to sell the company to Chicago Bridge & Iron Co. for $3 billion, Reuters reports. Denali Investors, which calls the offer by CB&I undervalued, says in a letter to independent directors that Shaw's chairman, James Bernhard, wants to close the deal by the first half of 2013 to enable him to run for the Senate or for governor of Louisiana, where Shaw is based. "We believe this helps explain why the current deal discussions began in May 2012 and [are] timed to close in the first half of 2013, given any Senate candidate cannot afford to wait beyond 2013," Denali Investors says in the letter. But a Shaw Group spokesperson says the company hasn't been able to confirm the investment fund is even a shareholder. "This letter is written by one small investor who claims to be a Shaw shareholder. We have been unable to substantiate that this investor owns any shares," says Gentry Brann, Shaw's vice president of investor relations and corporate communications, in an email to Daily Report. "This deal offers an attractive 72% premium. We firmly believe the transaction with CB&I is in the best interest of and creates significant value for Shaw's shareholders as well as our employees and customers." —Steve Sanoski

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