Vice chancellor of the Delaware Chancery Court Travis Laster said RBC was acting as an advisor for Warburg and was eager to collect fees from the deal.
Warburg acquired the ambulance operator for $438m in June 2011.
Laster said, “Senior bankers at RBC were engaged in a full-court press to convince Warburg to include RBC in the financing package. While those fevered efforts were under way, RBC was simultaneously revising its valuation of Rural downward.”
“RBC created the unreasonable process and informational gaps that led to the board’s breach of duty.”
Last August Rural/Metro filed for Chapter 11 bankruptcy after failing to make an interest payment on its debts in July.
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