https://ift.tt/xAGqp4Q Shareholder Sues To Halt $11.6B Berkshire Takeover Over Lack Of Disclosures – Cryptovibes.com – Daily Cryptocurrency and FX News

A shareholder at Alleghany Corp (Y.N), which agreed last month to be acquired by Warren Buffett’s Berkshire Hathaway Inc (BRKa.N), sued the insurance company on April 13 accusing it of making misleading and inadequate disclosures about the $11.6 billion takeover.

Alleghany failed to explain the financial basis for the “fairness opinion” in a statement issued by its bankers at Goldman Sachs, which evaluated whether the deal was fair to shareholders, the plaintiff Shiva Stein said in a complaint filed in Manhattan federal court.

The complaint said, due to a lack of additional disclosures, the:

“Plaintiff will be unable to make a fully-informed decision regarding whether to vote in favor of the proposed transaction, and she is thus threatened with irreparable harm.”

Unless more disclosures are made, Stein wants to block New York-based Alleghany from being bought by Berkshire and also seeks unspecified damages. The takeover price has also been argued as too low by the New Jersey resident.

Alleghany failed to immediately respond to requests for comment. The plaintiff’s lawyer did not immediately respond to a similar request. Nonetheless, Berkshire is not a defendant.

When shareholders like Stein find the disclosures too sparse or terms unfair, they often sue to block corporate mergers.

Citing an alleged lack of disclosures to support a Goldman fairness opinion, Stein sued Mandiant Inc (MNDT.O) on April 1 to block the cybersecurity company’s $5.4 billion takeover by Alphabet Inc’s (GOOGL.O) Google.

On March 21, Berkshire agreed to pay $848.02 per share for Alleghany, at a 25% premium.

The price was called “fair from a financial point of view” by Goldman’s fairness opinion to Alleghany shareholders.

Berkshire’s large portfolio of insurers, including Geico and General Re, would be expanded by the purchase. Also, it would reunite Alleghany Chief Executive Joseph Brandon, who led General Re from 2001 to 2008, with Buffet.

The case was filed as Stein v Alleghany Corp et al, U.S. District Court, Southern District of New York, No. 22-03057.