When a stock has been stagnant for years (nearly a decade) and someone offers to buy your company at a 24% premium, what do you do? If you’re Anheuser-Busch (BUD) CEO Augustus Busch IV, you tell them to shove it…and get your company sued. Reuters:
A shareholder is suing Budweiser maker Anheuser-Busch Cos Inc (BUD.N) and its board of directors, claiming they failed to properly consider signs of interest in a possible takeover by Belgian brewer InBev NV (INTB.BR).
The lawsuit, which seeks class-action status, was brought in St. Louis Circuit Court on Wednesday by shareholder James Mayfield.
The lawsuit accuses members of the board of breaching their fiduciary duties and seeking to “entrench themselves in office.” It also alleges that Busch family members have “refused to meet with InBev and have discouraged any public bid for Anheuser-Busch by stating that no company will acquire Anheuser-Busch while they sit on the company’s board of directors.”
The suit is premature and just opportunistic. rumours of the InBev bid are just 2 weeks old and, despite opposition by the Busch family, it’s hardly off the table. Just yesterday, Forbes reported that many important BUD investors were very happy with the potential $65/share offer. Too bad for the Busch family, as they only own (close to) 1% of the company.
Mayfield is out, but the lawsuit will continue.
Mayfield, a resident of Anheuser’s home city of St. Louis, has since asked to be removed from the case.
“(Mayfield) is concerned about emotional backlash from people in the St. Louis community … who misunderstand the case,” said plaintiff’s attorney Frank Bottini in an interview.
He said another shareholder would be substituted for Mayfield, but declined to identify the new plaintiff.
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