NEW YORK - Loews Corporation (NYSE: NYSE:L), a diversified holding company, today received a favorable ruling from the Delaware Court of Chancery regarding its previous acquisition of Boardwalk Pipelines' minority limited partner interests. The court found no liability on the part of Loews in the transaction that took place in 2018.
The legal proceedings date back to November 2021 when the Delaware Court of Chancery awarded approximately $690 million, plus interest, to the class of former minority unitholders of Boardwalk Pipelines. However, this ruling was overturned by the Delaware Supreme Court in December 2022, and the case was sent back to the Court of Chancery for a decision on the remaining claims. The court's decision today concludes the litigation.
James S. Tisch, President and CEO of Loews Corporation, expressed satisfaction with the court's decision, stating, "We are very pleased that the Delaware Court of Chancery ruled in our favor and continue to believe that the process we undertook in 2018 to purchase the minority units in Boardwalk was appropriate. We are hopeful that this ruling will resolve the litigation."
Loews Corporation, with interests in insurance, energy, hospitality, and packaging industries, has faced legal challenges following its move to consolidate ownership of its subsidiary, Boardwalk Pipelines. Today's ruling marks a significant point in the company's legal journey, potentially putting an end to the series of litigations related to this acquisition.
The information reported is based on a press release statement from Loews Corporation.
In other recent news, Loews Corporation has witnessed significant developments. The company announced a CEO transition with James Tisch set to retire and Benjamin Tisch, the current senior vice president of corporate development and strategy, stepping in to fill the role. This leadership change is scheduled for the end of the year, with James Tisch remaining as chairman.
Loews also reported a rise in quarterly profits, attributing this to an increase in insurance premiums and improved investment returns. The company's investment income for the quarter ending June 30 climbed to $639 million, up from $592 million in the same period last year.
The majority of the company's revenue comes from its insurance unit, CNA Financial Corporation, where Loews holds approximately a 92% stake. CNA reported a revenue increase of 6.5% in the second quarter. Loews' profit for the quarter reached $369 million, or $1.67 per share, a slight increase from the $360 million, or $1.58 per share, recorded a year prior. These are among the recent developments within the company.
InvestingPro Insights
As Loews Corporation (NYSE: L) emerges from a favorable legal decision regarding its acquisition of Boardwalk Pipelines, the company's financial health and market performance continue to be of interest to investors. According to InvestingPro data, Loews Corporation is trading at a P/E ratio of 11.87, which is considered low relative to its near-term earnings growth. This suggests that the company may be undervalued, offering potential for investors seeking growth opportunities.
On the financial front, Loews has demonstrated robustness with a reported gross profit of $6.058 billion over the last twelve months as of Q2 2024, which translates to a gross profit margin of 36.31%. The company's revenue growth has also been positive, with an 11.43% increase over the same period. These figures indicate a strong operational performance, reinforcing the company's stability and potential for future growth.
InvestingPro Tips highlight that Loews Corporation has maintained dividend payments for 54 consecutive years, showcasing its commitment to shareholder returns. Additionally, the company's stock is trading near its 52-week high, at 96.66% of the peak, which could signal investor confidence in its long-term prospects. For investors seeking more detailed analysis, InvestingPro offers numerous additional tips on Loews Corporation, accessible at https://www.investing.com/pro/L.
Investors considering Loews as part of their portfolio will find these insights particularly valuable when assessing the company's performance and potential for future growth. With a market capitalization of $17.7 billion and a track record of profitability, as evidenced by its positive performance over the last twelve months, Loews Corporation stands out as a company worth watching in the diversified holding sector.
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