From the Wires
Acquisition of FirstCity Financial Corporation by Varde Partners, Inc. May Not Be in FirstCity Financial Shareholders' Best Interests
By: PR Newswire
Dec. 21, 2012 09:14 PM
SAN DIEGO and WACO, Texas, Dec. 21, 2012 /PRNewswire/ -- Shareholder rights attorneys at Robbins Umeda LLP are investigating possible breaches of fiduciary duty and other violations of the law by members of the board of directors of FirstCity Financial Corporation (NASDAQ: FCFC) in connection with their efforts to sell the company to Värde Partners, Inc.
On December 21, 2012, FirstCity Financial and Värde Partners announced they had entered into a definitive merger agreement. Under the terms of the agreement, certain funds managed by Värde will acquire FirstCity Financial through an all cash offer in which FirstCity Financial shareholders will receive $10 per share. The transaction is expected to close in the first half of 2013.
The Board of Directors' Actions May Prevent FirstCity Financial Shareholders from Receiving the Maximum Value for Their Stock
Robbins Umeda LLP's investigation focuses on whether the board of directors at FirstCity Financial is undertaking a fair process to obtain maximum value and adequately compensate its shareholders. The $10 per share offer price is below the $10.83 share price the stock traded at on May 10, 2012. Further, on November 14, 2012, FirstCity Financial announced strong financial results for the third quarter 2012, reporting a revenue increase of 73% over the same quarter in 2011. Moreover, following completion of the merger, three of FirstCity Financial's Senior Vice Presidents will become executive officers. Head of U.S. Acquisitions, Mark B. Horrell, Head of Global Acquisitions, Terry R. DeWitt, and Managing Director James C. Holmes, will become Chief Executive Officer, Chief Credit Officer, and Chief Operations Officer, respectively. Given, these facts, the firm is examining whether the board of directors' decision to sell FirstCity Financial for $10 per share is fair to shareholders and maximizes the value for their shares.
FirstCity Financial shareholders have the option to file a class action lawsuit against the company to secure the best possible price for shareholders and the disclosure of material information so shareholders can vote on the transaction in an informed manner. FirstCity Financial shareholders interested in information about their rights and potential remedies can contact Darnell R. Donahue at (800) 350-6003, firstname.lastname@example.org, or via the shareholder information form on the firm's website.
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. For more information, please go to http://www.robbinsumeda.com.
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SOURCE Robbins Umeda LLP
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