Daily Research News Online

The global MR industry's daily paper since 2000

Infogroup Buy Challenged

March 12 2010

Infogroup’s planned acquisition by private equity firm CCMP Capital is the subject of a shareholder lawsuit, according to investor advocacy group The Shareholders Foundation.

The foundation (www.shareholdersfoundation.com ) says an investor in the company filed a lawsuit in Nebraska State Court this week on behalf of current shareholders, alleging ‘breaches of fiduciary duty by the IUSA board arising out of their attempt to sell infoGroup via an unfair process and unfair price’.

The suit alleges that the offer price of $8.00 per share in the Omaha, Nebraska-based database giant ‘is unfair to shareholders because it represents no premium’, but is less than the $8.99 per share at which the group traded as recently as November 10, 2009.

The suit makes reference to the ‘destruction’ of company value following the firing of founder Vinod Gupta for making improper use of company funds; asserts that shares in the group have more than doubled over the past year; and says the CCMP deal is ‘designed not to maximize value for the company’s shareholder, but to benefit company insiders such as Gupta’, whose shares will be worth about $118m.

No stranger to shareholder litigation the group, then infoUSA, set up a Special Committee in January 2008 partly in response to ongoing litigation by minor shareholders including Dolphin Limited Partnership and Cardinal Capital. MR software giant SPSS also faced a shareholder investigation last August over its sale to IBM, which nevertheless went ahead two months later.

Infogroup is the parent of veteran research firm ORC (Opinion Research Corporation). Web site: www.infogroup.com .

Select a region below...
View all recent news
for UK
UK
USA
View all recent news
for USA
View all recent news
for Asia
Asia
Australia
View all recent news
for Australia

REGISTER FOR NEWS EMAILS

To receive (free) news headlines by email, please register online