A Delaware judge suspended the merger of C&J Energy Services with the well maintenance unit of Nabors Industries Tuesday after deciding C&J’s board failed to adequately hear other potential offers before accepting the deal.
The deal will be suspended for 30 days in response to a lawsuit filed by C&J shareholders.
C&J was ordered to shop for other potential buyers during the suspension period, the Wall Street Journal said.
In June, Bermuda-based Nabors agreed to merge its well maintenance unit with Houston-based C&J for $2.86 billion in cash and stock.
Nabors is set to earn $937 million in cash and 62.5 million shares in the merged company.
Although C&J is the buyer in the deal and would manage the merged company Nabors would hold a 53 percent share.
The court said that because C&J shareholders are effectively giving Nabors control of their investments C&J must hear other offers to ensure shareholders are getting the best price possible, the Wall Street Journal said.
Neither company has commented on the decision.