TAKE A LOOK AT WHICH REPORT YOUR PORTFOLIO'S BEEN MISSING...

Shareholders Foundation offers real-time reporting of class action exposure on a per transaction basis,
including the documents you will need for claim filing and settlement recovery.
Start Monitoring Your Investments

The Pep Boys - Manny, Moe & Jack (NYSE:PBY) Investor Files Lawsuit Against Going Private Bid By The Gores Group

  • If you are a current investor in The Pep Boys - Manny, Moe & Jack (NYSE:PBY) and purchased NYSE:PBY shares prior to Jan. 30, 2012, you have certain options and should contact the Shareholders Foundation, Inc.

  • To have your information reviewed for options and to receive notifications about this case, please send an email to mail@shareholdersfoundation.com, or call us at (858) 779-1554.

Lawsuit Overview

Company
The Pep Boys - Manny, Moe & Jack
Security
NYSE: PBY

Case Name
The Pep Boys Deal Case 02/02/2012
Type of Lawsuit
Mergers and Acquisition
You must register or login to receive notifications.

Click here to subscribe to The Pep Boys - Manny, Moe & Jack.
Summary

San Diego, Feb. 2, 2012 (Shareholders Foundation) -- An investor in NYSE:PBY shares filed a lawsuit against directors of The Pep Boys in effort to block the proposed takeover of the automotive parts retailer by The Gores Group LLC for $15 per NYSE:PBY shares.
According to the complaint the plaintiff alleges that the defendants breached their fiduciary duties owed to the Pep Boys investors arising out of the attempt to sell The Pep Boys - Manny, Moe & Jack via an unfair process at an unfair price.

On Monday, Jan 30, 2012, The Pep Boys - Manny, Moe & Jack announced that it has entered into a merger agreement under which it will be acquired by The Gores Group for a total enterprise value of the transaction is approximately $1.0 billion. Under the terms of the proposed transaction, The Gores Group will acquire all the outstanding common shares of The Pep Boys for $15.00 per share in cash.

The Pep Boys said the $15offer represents a premium of 24% percent over Pep Boys’ closing price of $12.08 on January 27, 2012 and a premium of 36% percent over Pep Boys’ volume weighted average closing price over the last 30 trading days.

However, the plaintiff alleges that the $15offer undervalues NYSE:PBY shares. In fact, the plaintiff says the offer represents a 6% discount to the price of %15.96 per share at which the company’s stock traded just one year ago. Additionally NYSE PBY stocks traded during 2007 as high as$22.26 per share and at least one analyst recently set a high target price for NYSE PBY shares at $17.00 per share, thus well above the current offer.

Furthermore the Pep Boys’ financial performance increase lately. The Pep Boys reported that its Total Revenue rose from $1.91billion for a 52weeks period ending on Jan 30, 2010 to $1.98billion for a 52weeks period ending on Jan 29, 2011 and its Net Income over the same time periods increased from $23.04million to $36.63million.

In addition the plaintiff alleges that the defendants deterred potential bidders by agreeing to pay a $10million termination fee, which will go to $25million following the end of the go-shop period.