Sauer-Danfoss Inc. Shareholder Files Lawsuit Over Alleged Unfair Takeover

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Company Name(s): 
Sauer-Danfoss
Case Name: 
Sauer-Danfoss Deal Case 01/15/2010
Case Status: 
Lawsuit Filed
Affected Securities
NYSE: SHS
Lawsuit Overview
Type of Lawsuit: 
Mergers and Acquisition
Date Filed: 
01/13/2010
Class Period End: 
12/22/2009
Summary: 

An investor filed a lawsuit on behalf of current investors Sauer-Danfoss Inc. (Public, NYSE:SHS), who purchased the SHS shares before December 22, 2009, over potential breaches of fiduciary duty with an alleged unfair takeover price and practice.

According to the complaint the plaintiff alleges breaches of fiduciary duty by Danfoss A/S and others arising out of the attempt to take over the minority stake of Sauer-Danfoss Inc. (Public, NYSE:SHS) at an unfair price. On December 22, 2009 Danfoss A/S ("Danfoss") announced that, through its wholly owned subsidiary Danfoss Acquisition, Inc., it intends to launch a cash tender offer for all of the outstanding shares of common stock of Sauer-Danfoss Inc. (NYSE: SHS) not already owned by Danfoss A/S and its subsidiaries, which is a stake of approximately 24.3% of Sauer- Danfoss A/S Inc valued at approximately $118,750,000 at the $10.10 per share offer price. Danfoss A/S announced that it intends to offer the public minority shareholders of Sauer- Danfoss A/S $10.10 per share in cash, without interest and less any required withholding tax. According to Danfoss A/S the price represents a premium of approximately 19.7% over the closing price of the common stock on the New York Stock Exchange on December 18, 2009, and a premium of approximately 20.7% over the average closing price during the three months preceding December 18, 2009.

According to a previous investigation by a law firm “the transaction appears to be unfair” to current investors of Sauer-Danfoss Inc. (NYSE:SHS) because the “offer to purchase Sauer-Danfoss Inc. (SHS) appears opportunistically timed to take advantage of the current economic downturn” and is “grossly unfair, inadequate, and substantially below the fair or inherent value of SHS”.

Sauer-Danfoss Inc., located in Lincolnshire, Illinois, develops, manufactures and markets advanced systems for the distribution and control of power in mobile equipment. The Company designs, manufactures and markets hydraulic, electronic, electric and mechanical components, as well as software and integrated systems that generate, transmit and control power in mobile equipment. Sauer-Danfoss reported in 2007 Total Revenue of $1.972.55billion with a Net Income of $47.20million and in 2008 Total Revenue of $2.090.51billion.