A Steelcase shareholder has filed a lawsuit seeking to halt the forthcoming vote on the company's planned £1.7 billion sale to HNI Corp., alleging the agreement is "tainted" by undisclosed conflicts of interest and undervalues the Michigan-based furniture maker. The plaintiff, Dean Drulias, aims to block the 5 December vote until the board provides fuller disclosure. Steelcase has stated it remains committed to completing both the vote and the mid-December closing.
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The complaint argues that the agreed price of $18.30 per share is "unfair" and below Steelcase's true value, citing JP Morgan's assessment that shares could be worth up to $29.15. It further alleges that outgoing president and chief executive Sara Armbruster stands to gain personally, with more than $24 million in cash and the ability to monetise equity worth over $44.8 million.
Two board members, Timothy Brown and Linda Williams, are accused of facing conflicts of interest after being offered paid positions on HNI's board while negotiations were still underway. The suit also questions the incentives of financial advisers Goldman Sachs and BofA Securities, whose contingent fees of $33 million and $10.9 million were dependent on the deal closing, allegedly encouraging favourable "fairness opinions" irrespective of the transaction's merits.
Source: www.mlive.com
