According to reporting from Florida Trend, Perry Ellis International, the global clothing brand headquartered in Miami, Florida, recently announced that it has entered into a merger agreement under which the company will be owned by a private entity controlled by the company’s original founder George Feldenkreis. Notably, Mr. Feldenkreis is currently on the Board of Directors at Perry Ellis International.
According to the reporting, the total value of the deal is approximately $437 million. At this figure, each share held by investors is valued at $27.50. This merger was approved unanimously by the Board of Directors. The company is now set to be taken private by Mr. Feldenkreis.
Under Florida law, shareholders can request information from the company to determine if the price offered is fair, or not. It would not surprise me if shareholders did so. – Jeffrey Sonn, of Sonn Law Group.
The Deal is Subject to Approval
As with all large transactions of this variety, this deal is still subject to final approval. The reporting indicates that the transaction is expected to be finalized in the latter half of 2018. For the merger agreement to officially close, it must be approved by a majority of shareholders who are affected by the transaction. In addition, the standard regulatory approval will be needed and the closing conditions must be met.
Investor Rights Must Be Protected
It is imperative that the rights of ordinary investors are protected throughout the course of this transaction. This transaction is notable as it involves a large company being taken private in a deal with one of its own board members. That board member, George Feldenkreis, and all other board members of Perry Ellis International, owe certain duties to the shareholders of the company.
All shareholders deserve fair market value for their stake in the company. Mr. Feldenkreis cannot be given the ability to buy the company at an unfair price. If there is any indication that there has been a breach of fiduciary duty, immediate action must be taken to rectify the problem.
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