Frontier Oil Corporation Merger Under Investigation For FTO Investors

If you purchased shares of Frontier Oil Corporation (NYSE:FTO) prior to the announcement and continue to hold those NYSE FTO shares, you have certain options and you should contact the Shareholders Foundation, Inc.

To have your information reviewed for options and to recieve notifications about this investigation, please use this form. You may also send an email to, or call us at (858) 779-1554.
Company Name(s): 
Frontier Oil
Affected Securities: 

The announcement of the proposed merger of Frontier Oil Corporation prompted an investigation on behalf of investors in Frontier Oil Corporation (NYSE:FTO) shares questioning the potential unfairness of the buyout and possible breaches of fiduciary duties by certain Frontier Oil Corp. officers and directors.

The investigation by a law firm concerns possible breaches of fiduciary duties by certain officers and directors at Frontier Oil Corporation arising out of their attempt to merge Frontier Oil Corp. with Holly Corporation.

On Tuesday, Feb. 22, 2011, Frontier Oil Corporation (NYSE: FTO) and Holly Corporation (NYSE: HOC) announced that the Boards of Directors of both companies have unanimously approved a merger agreement under which the companies will combine in an all-stock merger of equals transaction. Under the terms of the proposed agreement, Frontier Oil Corporation shareholders will receive 0.4811 Holly Corp. shares for each share of Frontier Oil Corp (FTO) common stock. Upon closing of the transaction, Holly Corp. shareholders are expected to own approximately 51 percent and Frontier Oil Corporation shareholders are expected to own approximately 49 percent of the combined company.
Based on a closing price of $56.12 of Holly Corporation (NYSE: HOC) shares on last Friday the proposed takeover asks investors in Frontier Oil Corporation to hand over their shares at a value of $26.99.

Consequently FTO shares fell in response to the announcement to $27.16 during on Tuesday, Feb 22. Given a recent shares FTO price of $28.94 per share as recently as Feb. 17 investors in Frontier Oil Corporation would hand their shares over at a discount to recent trading prices. Additionally analysts have set a price target as high as $33.00 per share for Frontier Oil stock. Shares of Frontier Oil Corporation (NYSE: FTO) traded in 2007 as high as $48.49 per share, during 2008 as high as $37.73 per share.

Therefore the investigation concerns whether the Frontier Oil Corp Board of Directors undertook an adequate and fair sales process to obtain maximized consideration for all shareholders of Frontier Oil Corporation (NYSE:FTO) and specifically whether the Frontier Oil board of directors breached their fiduciary duties to Frontier Oil Corp (NYSE:FTO) shareholder by failing to adequately shop the Company before entering into this transaction. The investigation concerns also whether Holly Corporation is underpaying for NYSE FTO shares, thus unlawfully harming FTO stockholders.

A potential class action lawsuit would seek to maximize the amount of money and information NYSE FTO shareholders would receive in a buyout, so the law firm.