Shareholder Rights Law Firm Johnson & Weaver, LLP Announces Investigation of Fairness of Peet's Coffee & Tea, Inc. Going Priv...
24 Julho 2012 - 4:50PM
Business Wire
Shareholder Rights Law Firm Johnson & Weaver, LLP is
investigating whether members of the board of directors of Peet's
Coffee & Tea, Inc. (PEET) breached their fiduciary duties and
violated other laws in connection with their efforts to sell the
company to a German financial conglomerate.
On July 23, 2012, Peet’s announced that it will be acquired by
Joh. A. Benckiser, the investment vehicle for Germany’s Reimann
family, for $73.50 per share. Peet’s also emphasized that the
agreement was “unanimously approved by the Peet's Board of
Directors” and represents a premium of approximately 29% over
Peet's closing stock price on July 20, 2012. “This announcement
uses fuzzy math,” said Frank Johnson of Johnson & Weaver, LLP.
Johnson added that “before a recent downturn, the stock traded at
or above $70 for much of 2012, closing as high as $76.82 less than
three months ago.” In addition, several analysts have set target
prices for Peet's between $80 and $95 per share based on recent
growth and positive results. Thus, while the Benckiser offer price
may seem attractive when compared to a closing price just days
before, an analysis of Peet’s long-term performance raises
questions as to whether this deal is an attempt to buy a solidly
profitable company on the cheap during a temporary period of
decline.
According to Mitchell Pinheiro of Janney Capital Markets, “We
thought Peet’s would make more sense for a larger packaged food
company that would have more marketing muscle, distribution power,
and cost synergies, as opposed to being part of a private equity
portfolio.” In other words, had Peet’s Board of Directors elected
to merge the Company with another strong, logically synergistic
publicly traded company, Peet’s shareholders could have maintained
their equity interest and realized the “growth potential” from such
a merger. Instead, Peet’s Board agreed to a “going-private” deal
that cashes out shareholders at a discount with no opportunity to
reap the benefits of any future growth. Interestingly, Peet’s Board
required as a condition of the going-private deal that “[t]he
current management and employees will remain with the company, and
its headquarters will stay in Emeryville, CA.” Peet’s Coffee
Acquired in Billion-Dollar Deal, MSNBC Marketday, July 23,
2012.
The law firm’s investigation focuses on whether the process
employed and the price to be paid in the transaction are fair to
Peet’s shareholders. “In light of the positive financial
performance of Peet’s in recent months and the target prices well
above the purchase price, there are questions about this deal that
should be answered,” said Johnson. He has offered to discuss this
matter with any of Peet’s shareholders who are concerned about
their legal rights and remedies, as well as others who may have
information about the above.
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