A Delaware court on Thursday refused to block the $6.9 billion merger of Plains Exploration & Production Co. with Freeport-McMoRan Copper & Gold Inc., clearing the way for Plains shareholders to vote on the proposal May 20.

In a friendly deal, Freeport in December offered an estimated $9 billion in cash and stock to buy Plains and McMoRan Exploration Co. (see Daily GPI, Dec. 6, 2012). Freeport agreed to pay $6.9 billion for Plains and $3.4 billion ($2.1 billion net) for McMoRan. Freeport Chairman Jim Bob Moffatt co-chairs McMoRan with Freeport CEO Richard Adkerson. Plains holds a 31.5% stake in McMoRan (see Daily GPI, Sept. 21, 2010).

Some Plains shareholders had challenged the merger, claiming that the board failed to secure the best price. The dissidents sought a preliminary injunction to prevent the buyout from proceeding.

Delaware’s Court of Chancery, which had consolidated the lawsuits, ruled against the plaintiffs, which “have not established a reasonable probability of success on the merits” of their claims that Plains’ board had breached its fiduciary duties (In re Plains Exploration & Production Co. Stockholder Litigation, No. 8090-VCN).

Houston-based Plains, which develops assets in the U.S. onshore and in the Gulf of Mexico, said the board and management “continue to believe that the transaction is in the best interests” of shareholders.

“The combined company would be a leading global resources company with long-lived and geographically diverse minerals and oil and gas reserves, strong margins and cash flows, an attractive growth pipeline and a strong balance sheet,” said Moffett and Adkerson.

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