A shareholder lawsuit contends that Costa Mesa-based Ceradyne Inc. failed to seek other bids before it agreed to an $860 million sale to St. Paul, Minn.-based 3M Co.
The suit alleges Ceradyne negotiated exclusively with 3M and structured a deal that would discourage other bidders.
Ceradyne declined to comment.
The company makes ceramics-based body armor and other products, and had sales of $572 million last year.
Its stock price has remained unchanged during early trading at a market value of about $846 million.
