Robbins Umeda LLP Announces an Investigation of GeoEye, Inc.
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 GeoEye, Inc. (NASDAQ: GEOY) in connection with their efforts to sell the company to DigitalGlobe, Inc. (NYSE: DGI). 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 July 23, 2012, GeoEye announced that it had entered into a definitive merger agreement to be acquired by DigitalGlobe. According to the terms of the deal, DigitalGlobe will acquire all of the outstanding shares of GeoEye through a stock and cash transaction valued at approximately $20.27 per GeoEye share. Pursuant to the agreement, GeoEye shareholders will have the right to elect to receive either 1.137 shares of DigitalGlobe common stock and $4.10 per share in cash, 100% of the consideration in cash, or 100% of the consideration in stock, for each share of the company they own. The transaction is expected to close by the first quarter of 2013.
Robbins Umeda LLP’s investigation focuses on whether the board of directors at GeoEye is undertaking a fair process to obtain maximum value and adequately compensate shareholders. At least three market analysts have released target prices for GeoEye that value the company’s stock between $23 and $28 per share, considerably higher than the value currently being offered by DigitialGlobe as a part of the proposed transaction. Additionally, shares of GeoEye’s common stock have traded and closed above the current offer price as recently as May 25, 2012, closing on that day at $20.39 per share.
Furthermore, on May 3, 2012, GeoEye reported financial results that exceeded analyst projections and represented substantial increases over 2011 figures. Specifically, the company reported revenue of $89.28 million for the first quarter of 2012, beating consensus estimates of only $85.84 million. Additionally, GeoEye reported earnings per share of $0.58, which beat analyst projections of only $0.49 by $16.23%. Matt O’Connell, the Chief Executive Officer of GeoEye, also expressed optimism about the company’s continuing growth prospects, stating: “Results for the first quarter were above our expectations, as our core business remained strong, and our international business continued to exhibit solid growth…. We renewed a number of large international affiliate contracts, which gives us excellent visibility into our 2012 revenues.”
Given these impressive financial results, recent target prices, and future prospects, Robbins Umeda LLP is examining the board’s decision to sell GeoEye rather than allow shareholders to continue to participate in the company’s continued success and future growth prospects.
Robbins Umeda LLP attorneys highlight that GeoEye 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.