An investor in ACF stock filed a lawsuit in Texas State Court on behalf of current investors of AmeriCredit Corp. (NYSE:ACF) alleging breach of fiduciary duty for selling AmeriCredit too cheaply to General Motors.
AmeriCredit Corp., located in Fort Worth, Texas, is an auto finance company operating in the automobile finance business. According to the complaint the plaintiff alleges that the defendants breached their fiduciary duty by trying to sell AmeriCredit through an unfair process at an unfair price. On Thursday, July 22, 2010, AmeriCredit Corp. (NYSE: ACF) and General Motors (GM) announced that they have entered into a agreement for GM to acquire AmeriCredit in an all-cash transaction valued at approximately $3.5 billion. Under the terms of the agreement AmeriCredit shareholders will receive $24.50 in cash for each share of stock held as of the transaction closing date. According to AmeriCredit its board of directors approved the agreement.

Shares of AmeriCredit Corp. (ACF) traded before the news at $20.52 per share and increased in response to the announcement to $24.08 per share. But the plaintiff claims that “the proposed acquisition is the product of an unfair sales process” since “the proposed price actually represents a discount relative to its annual high of $26.17 on April 15, 2010” and “some analyst had set a target of $26 per share for AmeriCredit stock”. The plaintiff alleges that the takeover is not in the shareholders best interest because the defendants agreed to provisions, like the $105 termination fee, a no shop/ no talk clause, and certain voting agreements that irrevocable bind the company’s largest shareholder to vote in favor of the proposed acquisition, that prevent the possibility of another suitable bidder from stepping forward.