National Financial Partners Corp. (NYSE:NFP) Investor Files Lawsuit Against Takeover

If you purchased shares of National Financial Partners Corp. (NYSE:NFP) prior to April 15, 2013, and currently hold any of those NYSE:NFP shares, you have certain options and you should contact the Shareholders Foundation, Inc.

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Company Name(s): 
National Financial Partners
Case Name: 
National Financial Partners Deal Case 05/24/2013
Case Status: 
Lawsuit Filed
Affected Securities
NYSE: NFP
Lawsuit Overview
Type of Lawsuit: 
Mergers and Acquisition
Date Filed: 
05/24/2013
Summary: 

May 28, 2013 (Shareholders Foundation) - An investigation on behalf of investors in National Financial Partners Corp. (NYSE:NFP) shares was announced concerning whether the offer by Madison Dearborn Partners, LLC to acquire National Financial Partners Corp. for $25.35 per NYSE:NFP share and the takeover process are unfair to investors in NYSE:NFP shares.

The plaintiff alleges that the defendants breached their fiduciary duties owed to NYSE:NFP stockholders arising out of the attempt to sell the company too cheaply via an unfair process.

On April 15, 2013, National Financial Partners Corp. (NYSE: NFP) announced that it has entered into an agreement with Madison Dearborn Partners, LLC under which a controlled affiliate of Madison Dearborn will acquire National Financial Partners Corp. Under the terms of the agreement, National Financial Partners Corp shareholders will receive $25.35 in cash for each share of National Financial Partners Corp common stock they own, in a transaction with an equity value of approximately $1.3 billion, which includes the full value of the Company's convertible debt.

However, the plaintiff alleges that the $25.35-offer is too low and undervalues the company. The plaintiff alleges that the defendants failed to “maximize shareholder value in the sale by negotiating almost exclusively with financial buyers who typically do not realize the cost and revenue synergies that strategic buyers do but are more likely to keep existing management on and to offer it stock options and equity incentives”.

Furthermore, the plaintiff claims that “each of the members of the Company’s Board, including the members of the special committee formed to evaluate the potential sale of the Company, will receive at least 75,000 dollars (and in some cases millions of dollars) for their unvested restricted stock awards – payments they would not otherwise receive at this time absent a sale of the Company”.

National Financial Partners Corp. reported that its annual Revenue increased from $948.28 million in 2009 to over $1.06 billion in 2012.

Shares of National Financial Partners Corp. grew from as low as $2.67 per share in early 2009 to slightly under $24 in early April 2013.

On May 28, 2013, NYSE:NFP shares closed at $25.20 per share.