Acquisition of Material Sciences Corporation by New Star Metals, Inc. May Not Be in Shareholders’ Best Interests
Robbins Arroyo LLP are investigating the acquisition of Material Sciences Corporation (NASDAQ: MASC) (“Material Sciences”) by Zink Acquisition Holdings, Inc., and Zink Acquisition Merger Sub Inc., an affiliate of New Star Metals, Inc. and Insight Equity Holdings, LLC. On January 9, 2014, the companies announced the signing of a definitive agreement pursuant to which Zink Acquisition Holdings will acquire Material Sciences for $12.75 per share in cash.
Is the Proposed Merger Best for Material Sciences and Its Shareholders?
Robbins Arroyo LLP’s investigation focuses on whether the board of directors at Material Sciences is undertaking a fair process to obtain maximum value and adequately compensate Material Sciences shareholders in the merger.
As an initial matter, the $12.75 consideration represents a one day premium of approximately 13.6% based on Material Sciences’ closing price on January 8, 2014. This one day premium is substantially below the average one day premium of over 40% for comparable transactions in the last three years.
Further, Frank L. Hohmann III, a member of Material Sciences’ Board of Directors, and Privet Fund LP and Privet Fund Management LLC, which collectively own 19% of the outstanding shares of the company’s common stock, have agreed to: (i) vote in favor of the merger; (ii) vote against any alternative proposal; and (iii) vote against any other agreements or actions that would prevent or delay the merger. Ryan J. Levenson, another member of the Material Sciences board, is also the managing member of Privet Fund Management LLC.
Given these facts, Robbins Arroyo LLP is examining whether the Material Sciences board of directors are seeking to benefit themselves with their decision to sell the company to New Star Metals now rather than allow shareholders to continue to participate in the company’s continued success and future growth prospects.
Material Sciences shareholders have the option to file a class action lawsuit to ensure the board of directors properly evaluates the proposal to obtain the best possible price for shareholders and the disclosure of material information.
Material Sciences shareholders interested in information about their rights and potential remedies can contact attorney Darnell R. Donahue at (800) 350-6003, or you can complete the form below and we will contact you directly.
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