Several law firms are contesting the proposed sale of Staples to Sycamore Partners.
WB Journal reported that the planned $6.9 billion (€6 billion) acquisition by Sycamore Partners is being challenged by at least four law firms who say that the “Staples board of directors may have violated their fiduciary duty in approving the deal”.
Concerns that the purchase price undervalues the retail store have been voiced by Louisiana law firm Kahn Swick & Foti (KSF) which includes “former Attorney General Charles C. Foti, commented: “KSF is seeking to determine whether this consideration and the process that led to it are adequate,”
The article further noted that Brower Piven, a securities litigation law firm with offices in Maryland and New York, were investigating “whether Staples directors adequately pursued alternatives to the acquisition and whether the board obtained the best price possible for the company”.
Meanwhile Rigrodsky & Long of Delaware also said much the same and a Securities and Exchange Commission attorney Willie Briscoe’s Briscoe Law Firm of Houston, said: “the $10.25-per-share price is virtually no premium over the 52-week high and lower than at least one analyst’s estimated value of $12 per share”.
The proposed sale to Sycamore Partners came after Staples declared a loss of $615 million (€538 million) last year after which it closed 48 of its stores which left 1,500 in North America. The sale would mean that Staples would be under “common ownership” with a variety of other retail stores.
Staples has stated that its board of directors were unanimous in their approval of the acquisition and had recommended that share holders “vote[d] in favour of the deal which is expected to be finalised in December.