SAN DIEGO, Oct. 18, 2010 (GLOBE NEWSWIRE) -- The Shareholders Foundation, Inc. announces that an investor in King Pharmaceuticals, Inc. (NYSE:KG) filed a lawsuit in State Court against the King Chairman and CEO, King directors and others alleging breaches of fiduciary duties arising out of their attempt to sell King Pharmaceuticals too cheaply via an unfair process to Pfizer Inc.
Those who currently are long term investors in shares of King Pharmaceuticals, Inc. (NYSE:KG) and purchased their shares prior to October 12, 2010, should contact the Shareholders Foundation, Inc. by e-mail at mail@shareholdersfoundation.com or call +1 (858) 779-1554.
On Tuesday, October 12, 2010, King Pharmaceuticals, Inc. (NYSE:KG) and Pfizer Inc. (NYSE:PFE) announced that they have entered into a merger agreement under which Pfizer will acquire King Pharmaceuticals, Inc. for $3.6 billion in cash, or $14.25 per share. According to King Pharmaceuticals the offer represents a premium of approximately 40% to King Pharmaceuticals' closing price as of October 11, 2010, and 46% percent to the one-month average closing price as of the same date.
The plaintiff alleges that the proposed takeover is unfair to KG shareholders and King directors breached their fiduciary duties owed to the KG investors because they did not obtain the highest price. At first sight the Pfizer offer certainly seems to represent a significant premium for KG investors, but King Pharmaceuticals shares traded as early as April at $12.14, in March as high as $12.54, and in January over $13 per share leaving King Pharmaceuticals investors with a meager premium. In addition considering that during 2007 KG shares traded as high as $21.46 per share and at least one analyst has set a price target of $15.00 per share for King Pharmaceuticals stock the current Pfizer offer then leaves KG stockholders with practically no premium. Additionally the plaintiff claims, among other things, that the proposed buyout is also inadequate compared with King's potential future earnings. In the past King Pharmaceuticals reported over the past four years steady 12 months revenue ranging from $1.565 billion to $2.136 billion.
Those who currently are investors in King Pharmaceuticals, Inc. (NYSE:KG) and purchased their shares before the announcement, should contact the Shareholders Foundation, Inc.
The Shareholders Foundation, Inc. is an investor advocacy group which does research related to shareholder issues and informs investors of securities class actions, settlements, judgments, and other legal related news to the stock/financial market. The Shareholders Foundation, Inc. is not a law firm. The information is provided as a public service. It is not intended as legal advice and should not be relied upon.
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