Specialty Underwriters' Alliance, Inc. Investor Investigation alleges unfair takeover
Investigations on behalf of certain current investors of Specialty Underwriters' Alliance, Inc.(Public, NASDAQ:SUAI) over possible breach of fiduciary duty by the Specialty Underwriters Alliance board of directors – Contact the Shareholders Foundation, Inc at mail@shareholdersfounation.com
SAN DIEGO, CA ( www.ShareholdersFoundation.com ) - Investigations on behalf of current investor of Specialty Underwriters' Alliance, Inc.(Public, NASDAQ:SUAI), who purchased their shares before June 22, 2009, over possible breaches of fiduciary duty and other violations of state law by the Board of Directors of Specialty Underwriters' Alliance.
If you are a current investor in Specialty Underwriters' Alliance, Inc.(NASDAQ:SUAI) and purchased the shares before June 22, 2009, you have certain options and you should contact the Shareholders Foundation, Inc. at:
The investigations by law firms concern potential breaches of fiduciary duty and other violations of state law by the Board of Specialty Underwriters' Alliance to Tower Group, Inc. Tower Group, Inc. (NASDAQ: TWGP) and Specialty Underwriters' Alliance, Inc. NASDAQ: SUAI) announced on June 22, 2009 that they have entered into a definitive agreement for the acquisition of Specialty Underwriters' Alliance by Tower Group in a transaction valued at approximately $107 million. Under the terms of that agreement, SUAI shareholders would receive Tower TWGP common stock equal to $6.72 per SUAI share based on June 19, 2009 closing stock price for Tower TWGP of $24.00.
According to one investigation the transaction appears to be unfair “unfair given that Specialty has a book value of $8.73 per share” and alleges that “the sales process the Company conducted was flawed because the Company agreed to a non-solicitation provision and a termination fee of $3 million plus up to $1 million in expenses that will all but ensure that no superior offer will ever be forthcoming”. Another investigation focues on “potential improprieties in connection with the proposed acquisition of Specialty Underwriters Alliance, Inc”. Nearly a year ago Hallmark Financial Services, Inc made a conditional offer to buy SUAI for $6.50 a share. At that time, Hallmark Financial was Specialty Underwriters' Alliance’s largest shareholder with a nearly 10% stake in SUAI. According to the investigation “SUAI has rebuffed Hallmark's advances and was largely successful in fighting off a recent proxy battle” and that “the proposed deal potentially ends the effort by Hallmark Financial Services, Inc. …to purchase the Company.” Under the proposed agreement Specialty Underwriters' Alliance’s will have the right (for a limited period) to terminate the agreement, if Tower Group’s stock price during a defined period leading up to the merger falls below $20.00, unless Tower Group elects to add Tower shares to provide Specialty Underwriters' Alliance’s shareholders with a value per share of $6.51. This provision, so one investigation, “appears to protect Tower shareholders at the expense of SUAI shareholders and potentially provides for a meager $.01 per share increase over the offer made by Hallmark nearly a year ago”. Specialty Underwriters’ Alliance, Inc., located in Chicago, IL, through its wholly owned subsidiary, SUA Insurance Company (SUA), offers specialty commercial property and casualty insurance products through independent general agents, or partner agents that serve groups of insureds. Specialty Underwriters’ Alliance reported Total Revenue of $162million with a net income of $12.59million in 2007 and $153.49million Total Revenue with $7.42million net income in 2008. Shares of Specialty Underwriters’ Alliance (NASDAQ:SUAI) traded since the announcement at about $6.20 per share, down from $.850 per share in 2007 and over $10 per share in 2006.
Those who are current investors in Specialty Underwriters' Alliance, Inc.(NASDAQ:SUAI) and purchased the shares before June 22, 2009, have certain options and should contact the Shareholders Foundation, Inc. at:
Shareholders Foundation, Inc.
Trevor Allen
3111 Camino Del Rio North - Suite 423 -
92108 San Diego
Tel:+1-(858)-779-1554
Fax:+1-(858)-605-5739 mail@shareholdersfoundation.com www.ShareholdersFoundation.com
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