Robbins LLP: Acquisition of United Online Inc. (UNTD) by B. Riley Financial Inc. (RILY) May Not Be in Shareholders’ Best Interests
Robbins LLP is investigating the proposed acquisition of United Online, Inc. (NASDAQ: UNTD) by B. Riley Financial, Inc. (NASDAQ: RILY). On May 4, 2016, the two companies announced the signing of a definitive merger agreement pursuant to which B. Riley will acquire United Online. Under the terms of the agreement, United Online shareholders will receive $11.00 in cash for each share of United Online common stock.
Is the Proposed Acquisition Best for United Online and Its Shareholders?
Robbins LLP’s investigation focuses on whether the board of directors at United Online is undertaking a fair process to obtain maximum value and adequately compensate its shareholders.
As an initial matter, the $11.00 merger consideration represents a discount of -1.3% based on United Online’s one-month average closing price. This discount is significantly below the average one-month premium of nearly 40.5% for comparable transactions within the past three years. Further, the $11.00 merger consideration is significantly below the target prices of $19.50 set by an analyst at Benchmark Company LLC on April 6, 2016, and $19.00 set by an analyst at B. Riley & Co. on November 4, 2015. In the last three years, United Online traded as high as $62.29 on August 7, 2013, and most recently traded above the merger consideration at $11.07 on April 28, 2016.
In light of these facts, Robbins LLP is examining United Online’s board of directors’ decision to sell the company now rather than allow shareholders to continue to participate in the company’s continued success and future growth prospects.
United Online 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.
United Online 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.