Parthenon Capital Partners’ acquisition of automotive finance business Coastal Credit’s parent White River Capital is being investigated by a law firm over claims it short-changed investors in the company.
Kirby McInerney said it is looking into whether the White River board of directors violated their fiduciary duties by agreeing to the $79.5m deal, equivalent to $21.93 per share.
That figure is less than the $21.99 per share investors could have received for their shares as recently as November 12, the firm said, adding it was also significantly below the $27.11 price shares hit less than a year ago.
The Parthenon offer represented a one per cent premium on White River’s closing price the day before the deal was announced.
White River expects to hold a special meeting of shareholders to consider the proposed purchase by Parthenon, but is yet to set a date.
Parthenon has about $2bn of capital under management, and roughly 30 employees across its Boston and San Francisco offices.
It focuses on mid-market companies with enterprise values of between $50m and $500m.
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