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Friday, March 29, 2024 | Back issues
Courthouse News Service Courthouse News Service

Syntel Shareholders Sue to Block Acquisition by French Firm

(CN) – In an effort to stop the acquisition of IT services provider Syntel Inc. by France’s Atos, investors filed a class action claiming were not fully informed about the $3.57 billion deal.

The lawsuit was filed Oakland County Circuit Court against Michigan-based Syntel and several of the company's top officers including CEO Rakesh Khanna.

Syntel’s board of directors announced the acquisition on July 20, where Atos will pay $41 per share in an all-cash transaction already unanimously approved by Syntel’s board, the lawsuit says.

The class claims the terms of the acquisition “substantially favor Atos and are calculated to unreasonable dissuade potential suitors from making competing offers,” including a $111.5 million termination fee payable to Atos if Syntel backs out.

Moreover, shareholders claim financial statements filed by the defendants with the Securities Exchange Commission omitted important information about Syntel’s financial projections and valuation analyses, misleading investors into thinking the acquisition is fair.

Certain Syntel executive officers, including Khanna, are also facing potential conflicts of interest by retaining post-merger bonuses and employment after the acquisition, the details of which were not disclosed in the SEC statements.

Investors want to halt the acquisition and access to the allegedly withheld information.

The class is represented by Anthony L. DeLuca of Anthony L. DeLuca, PLC in Grosse Pointe Park, Mich., and of counsel: Rigrodsky & Long, P.A. in Wilmington Del. and RM Law, P.C. in Berwyn, Pa.

Categories / Business, Financial, International, Securities, Technology, Uncategorized

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