Presidential Life Corp (NASDAQ:PLFE) Investor Files Lawsuit Against Directors Over Alleged Breaches Of Fiduciary Duties In Connection With The Proposed Takeover By Athene Holding

July 23, 2012 (Shareholders Foundation) -- An investor in Presidential Life Corp (NASDAQ:PLFE) shares filed a lawsuit against directors of Presidential Life Corp in effort to stop the proposed takeover of Presidential Life Corp at $14.00 per NASDAQ:PLFE share.

The plaintiff alleges that the defendants breached their fiduciary duties arising out of the attempt to sell the company too cheaply via an unfair price to an Athene subsidiary.

On July 13, 2012, Presidential Life Corporation (NASDAQ: PLFE) and Athene Holding Ltd. announced an agreement for an Athene subsidiary to acquire Presidential Life for $14.00 per share in cash, representing an aggregate purchase price of approximately $415 million.

However, the plaintiff alleges that the $14offer undervalues the company and is unfair to NASDAQ:PLFE stockholders. Indeed, Presidential Life Corp has performed well for its investors in the past. Its annual Revenue rose from $225.79million in 2008 to $267.44million in 2011 and its Net Loss of $6.34million in 2008 turned into a Net Income of $38.94million in 2011.

Furthermore, the plaintiff claims that the proposed transaction is the product of a flawed process that is designed to ensure the sale of Presidential Life Corp to Athene Holding Ltd. on terms preferential to Athene Holdings Ltd., but detrimental to NASDAQ:PFLE stockholders. More specifically, the plaintiff says that certain defendants agreed in the merger agreement to certain onerous and preclusive deal protection devices, such as a no solicitation, a matching right provision, and a $18million termination fee, provision, that will deter potential superior proposals to acquire the common stock of the company from emerging.