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Arena Resources Inc (NYSE: ARD) Investors File Lawsuit 04/09/2010

  • If you currently hold shares of Arena Resources Inc (NYSE: ARD), you have certain options and you should contact the Shareholders Foundation, Inc.

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Lawsuit Overview

Company
Arena Resources, Inc.
Security
NYSE: ARD

Case Name
Arena Resources Deal Case 04/09/2010
Type of Lawsuit
Mergers and Acquisition
Court of Filing
Oklahoma County Court

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Summary

An investor in Arena Resources Inc (NYSE: ARD) shares filed a lawsuit in Oklahoma County Court on behalf of current investors in Arena Resources Inc (NYSE: ARD) alleging breaches of fiduciary duty by certain members of the board of directors of Arena Resources Inc for selling Arena Resources Inc too cheaply to Sandridge Energy.
According to the complaint the plaintiff alleges breaches of fiduciary duty by certain members of the Board of Directors of Arena Resources Inc and others arising out of their attempt to sell Arena Resources Inc (NYSE: ARD) to SandRidge Energy Inc and that the takeover is “wrongful, unfair and harmful to Arena Resources Inc's public stockholders”.

Arena Resources Inc, located in Tulsa, OK, is engaged in oil and natural gas acquisition, exploration, development and production, with activities in Oklahoma, Texas, New Mexico and Kansas. Arena Resources Inc reported in 2007 Total Revenue of $100.09 million, in 2008 $208.86 million, and in 2009 $126.24 million. On April 01, 2010 SandRidge Energy Inc (NYSE: SD) and Arena Resources Inc (NYSE: ARD) announced that they have entered into a definitive merger agreement under which Arena Resources Inc shareholders (NYSE: ARD) will receive stock and cash consideration valued at $40 per share of Arena Resources Inc common stock (NYSE: ARD) based on SandRidge Energy's April 1, 2010 closing price or a transaction value of approximately $6.2 billion. According to Arena Resources Inc the offer represents a 17% premium for Arena Resources Inc shareholders.

Shares of Arena Resources Inc (NYSE:ARD) traded before the announcement at $34.40 per share, and were down from its 52 week High of $45.72 per share and over $51 in Mid 2008.

The plaintiff alleges, among other things, that certain members of the board of directors of Arena Resources Inc have clear and material conflicts of interest, failed to maximize shareholder value and therefore breached their fiduciary duty to ARD shareholders by selling Arena Resources Inc via an unfair process and at an unfair price. The takeover, that includes a “no-solicitation clause and a termination fee of up to $50 million, is an “unlawful plan to squeeze out Arena Resources Inc's public stockholders through the implementation of a flawed process and unconscionable consideration”, so the lawsuit.