Ariba, Inc. (NASDAQ:ARBA) Investor Files Lawsuit Against Directors Over Alleged Breaches Of Fiduciary Duties In Takeover

If you purchased shares of Ariba, Inc. (NASDAQ:ARBA) prior to May 22, 2012 and currently hold any of those NASDAQ:ARBA shares, you have certain options and you should contact the Shareholders Foundation, Inc.

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Company Name(s): 
Ariba
Case Name: 
Ariba Deal Case 05/31/2012
Case Status: 
Lawsuit Filed
Affected Securities
NASDAQ: ARBA
Lawsuit Overview
Type of Lawsuit: 
Mergers and Acquisition
Date Filed: 
05/31/2012
Summary: 

May 31, 2012 (Shareholders Foundation) -- An investor in NASDAQ:ARBA shares filed a lawsuit against member of the board of directors of Ariba, Inc. in effort to block the proposed takeover of Ariba, Inc. at $45 per NASDAQ:ARBA share.

The plaintiff alleges that the defendants breached their fiduciary duties owed to NASDAQ:ARBA investors arising out of the attempt to sell the company too cheaply via an unfair process of SAP AG.

On May 22, 2012, SAP AG (NYSE: SAP) and Ariba, Inc. (Nasdaq: ARBA) announced that SAP’s subsidiary, SAP America, Inc., has entered into an agreement to acquire Ariba for $45.00 per share, representing an enterprise value of approximately $4.3 billion.

However, the plaintiff alleges that the $45offer is undervalues Ariba, Inc and is unfair to NASDAQ:ARBA investors. In fact, the takeover news shares of Ariba, Inc. (NASDAQ:ARBA) jumped on Tuesday, May 22, 2012, from $37.96 per share to $45.04 per share, thus slightly above the current offer. Furthermore, at least one analyst has set the high target price for NASDAQ:ARBA shares at $50.00 per share. In addition, Ariba’s financial performance increased lately. Its Total Revenue rose from $285.70million for the 12months period ending on Sept. 30, 2009 to $443.85milllion for the 12months period ending on Sept. 40, 2011 and its Net Income increased for the respective time periods from $8.19million to $33.26million.

Furthermore, the plaintiff claims that the board of directors created a playing field that is tilted in favor of SAP AG by agreeing to at least three provisions in derogation of their fiduciary duties to NASDAQ:ARBA shareholders, such as a no shop, a matching rights, and a $150million termination fee provision.