Ardea Biosciences, Inc. (NASDAQ:RDEA) Investor Files Lawsuit Against Directors To Stop Block Merger With AstraZeneca

If you who purchased shares of Ardea Biosciences, Inc. (NASDAQ:RDEA) prior to April 23, 2012 and currently hold any of those NASDAQ:RDEA shares, you have certain options and you should contact the Shareholders Foundation, Inc.

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Company Name(s): 
Ardea Biosciences
Case Name: 
Ardea Biosciences Deal Case 04/24/2012
Case Status: 
Lawsuit Filed
Affected Securities
NASDAQ: RDEA
Lawsuit Overview
Type of Lawsuit: 
Mergers and Acquisition
Date Filed: 
04/24/2012
Summary: 

April 25, 2012 (Shareholders Foundation) -- An investor in NASDAQ:RDEA shares filed a lawsuit against directors of Ardea Biosciences, Inc in effort to block the proposed takeover of Ardea Biosciences, Inc by AstraZeneca for $32 per share.

According to the complaint the plaintiff alleges that the defendants breached their fiduciary duties owed to Ardea Biosciences investors arising out of the attempt to sell the company at an unfair price via an unfair process.

On Monday, April 23, 2012, AstraZeneca and Ardea Biosciences, Inc. (NASDAQ: RDEA) announced that they have entered into a merger agreement, pursuant to which AstraZeneca will acquire Ardea Biosciences, Inc. Under the terms of the proposed transaction, AstraZeneca will acquire Ardea Biosciences, Inc. for $32 per share which represents a total cash value of approximately $1.26 billion.

However, the plaintiff alleges that the $32offer is unfair and undervalues the company. In fact, at least one analyst has set the high target price for NASDAQ:RDEA shares at $40 per share.

Additionally, the plaintiff claims the unfair price is the result of an unfair process that has been driven by two of Ardea Biosciences’ largest shareholders, Baker Brother Investments and Tang Capital Partners, and their representatives on the board of directors. Indeed, certain Ardea Biosciences shareholders representing approximately 30% of the current total shares outstanding have already entered into a voting agreement with AstraZeneca to vote in favor of the transaction.

Furthermore the plaintiff says the board of directors created a playing field that is tilted in favor of AstraZeneca by agreeing to at least three provision in derogation of their fiduciary duties to Ardea Biosciences’ shareholders, including a no shop, a matching rights and a termination fee provision.

NASDAQ:RDEA shares closed on April 24, 2012 at $31.65 per share.