Robbins LLP: Acquisition of Martha Stewart Living Omnimedia, Inc. (NYSE: MSO) by Sequential Brands Group, Inc. (NASDAQ: SQBG) May Not Be in Shareholders’ Best Interests
Robbins LLP is investigating the proposed acquisition of Martha Stewart Living Omnimedia, Inc. (NYSE: MSO) by Sequential Brands Group, Inc. (NASDAQ: SQBG). On June 22, 2015, the two companies announced the signing of a definitive merger agreement pursuant to which Sequential Brands will acquire Martha Stewart. Under the terms of the agreement, Martha Stewart shareholders will receive consideration equivalent to $6.15 for each share of Martha Stewart common stock owned.
Is the Proposed Acquisition Best for Martha Stewart and Its Shareholders?
Robbins LLP’s investigation focuses on whether the board of directors at Martha Stewart is undertaking a fair process to obtain maximum value and adequately compensate its shareholders.
As an initial matter, the $6.15 merger consideration represents a premium of only 16.48% based on Martha Stewart’s closing price on May 19, 2015. This premium is significantly below the average one-month premium of nearly 21.65% for comparable transactions within the past five years. Further, the $6.15 merger consideration is significantly below the target price of $7.18 set by an analyst at FBN Securities on March 6, 2015, and the target price of $7.00 set by an analyst at Noble Financial Group on October 16, 2014. In the last three years, Martha Stewart traded as high as $6.72 on March 31, 2015, and most recently traded above the target price – at $6.16 – on April 15, 2015.
Martha Stewart shareholders have the option to file a class action lawsuit to ensure the board of directors obtains the best possible price for shareholders and the disclosure of material information.
Martha Stewart shareholders interested in information about their rights and potential remedies can contact attorney Darnell R. Donahue at (800) 350-6003, or you can complete the form below and we will contact you directly.