CREDO Petroleum Corporation
Robbins Umeda LLP Announces an Investigation of CREDO Petroleum Corporation
Robbins Umeda LLP has commenced an investigation into possible breaches of fiduciary duty and other violations of the law by members of the board of directors of CREDO Petroleum Corporation (NASDAQ: CRED) in connection with their efforts to sell the company to Forestar Group Inc. (NYSE: FOR). Concerned shareholders who would like more information about their rights and potential remedies can complete the form below and we will contact you directly. You can also contact attorney Gregory E. Del Gaizo at (800) 350-6003.
On June 4, 2012, CREDO announced that it had entered into a definitive merger agreement to be acquired by Forestar. According to the terms of the deal, Forestar will acquire all outstanding shares of the company through an all-cash transaction. Pursuant to the agreement, CREDO shareholders will receive $14.50 in cash for each share of the company they own. The transaction is expected to close in the second half of 2012.
Robbins Umeda LLP’s investigation focuses on whether CREDO’s board is undertaking a fair process to obtain maximum value and adequately compensate shareholders in light of the company’s recent positive financial results. On April 26, 2012, CREDO reported strong operating results for the first quarter of fiscal year 2012. The company reported revenues of $5.8 million, a 79.1% increase over the $3.2 million in revenue reported during the same quarter of the previous year. Additionally, CREDO announced that net income rose a staggering 469.2% to $962,000 for the first quarter of 2012, compared to net income of only $169,000 in first quarter of fiscal year 2011. In the words of Michael C. Davis, CREDO’s Interim Chief Executive Officer, “We have been extremely successful transitioning Credo from natural gas to oil …We will continue to build on that momentum throughout 2012 with the objective of oil comprising 75% of our production mix by year-end.”
Given the company’s successful transition and impressive financial results, Robbins Umeda LLP is examining the board’s decision to sell CREDO now at $14.50 per share rather than allow shareholders to continue to participate in the company’s continued success and future growth prospects.
Robbins Umeda LLP attorneys highlight that CREDO shareholders have the option to file a class action lawsuit against the company to secure the best possible price for the company’s shareholders and the disclosure of material information to shareholders so they can vote on the transaction in an informed manner.
Robbins Umeda LLP is a nationally recognized leader in securities litigation and shareholder rights law. The firm represents individual and institutional investors in shareholder derivative and securities class action lawsuits, and has helped its clients realize more than $1 billion of value for themselves and the companies in which they have invested.