Alberto-Culver Co. shareholders and company management reached agreement to require a more competitive bidding process in a proposed $3.7 billion acquisition by Unilever, according to a news release from plaintiffs' attorneys Grant & Eisenhofer and Bernstein Litowitz Berger & Grossmann.
A lawsuit by a group of investors — including the $1.5 billion Oklahoma Firefighters Pension and Retirement System, Oklahoma City, and the $62 million Laborers Local 235 Benefits Fund, Elmsford, N.Y. — claimed that the process leading up to Unilever's proposed takeover of the beauty products company was “severely flawed, and not in any way designed to elicit the most economically favorable transaction for Alberto-Culver's shareholders,” according to a Bloomberg report.
The agreement requires Alberto-Culver to eliminate the matching rights it had granted to Unilever, lower any breakup fee the company may be obliged to pay to $100 million from $125 million, and provide any superior bidder with the same confidential documents that had been shared with Unilever, according to the news release.
“The lawsuit, filed in Delaware Chancery Court, alleged that Alberto-Culver had negotiated only with Unilever and had neither sought out other bids nor had canvassed the market to determine that the proposed transaction was the best deal available for shareholders,” the news release states. “Moreover, shareholders asserted that the Unilever transaction was sufficiently locked up at the time of its announcement that other potential bidders were effectively precluded from proposing a superior offer for the beauty company.”
Stuart Grant, managing director of Grant & Eisenhofer, said in a telephone interview that the agreement levels the playing field for potential bidders.
“Right now we have no confidence that they've gotten the better bid,” Mr. Grant said.
An Alberto-Culver spokesman could not be reached for comment.