Well, it seems that as soon as one big story hits the press, it’s followed by yet another. Hot on the heels of the shock departure of Remy Martin, CEO. Patrick Piana, comes another tale of woe with the shareholders of U.S. drinks group, Beam Inc. attempting to block the buyout by Japanese giant beverage producer, Suntory.
Beam, whose portfolio includes Courvoisier Cognac, was due to be bought out by Suntory for the sum of $16 billion US dollars. And the terms of the takeover were that the shareholders would get $83.50 for each share.
However, there’s been anger amongst some shareholders that this buyout undervalues the company.
Shareholder, Todd Miller, has filed a complaint to the Illinois state court, saying “The inadequacy of the proposed consideration is even more evident when one considers the substantial synergies to be enjoyed by Suntory if the proposed acquisition is consummated.” He’s now attempting to gain a court order to stop the move unless new terms are agreed.
And he’s not the only one, because another shareholder, Carol Chichester, has also filed a lawsuit in an attempt to halt the purchase.
But that’s not all, because now an investor pension fund is planning to sue Beam for the same reasons. NECA-IBEW Pension Trust Fund filed a lawsuit on Wednesday 23rd January saying, “The proposed acquisition is the product of a hopelessly flawed process that is designed to ensure the sale of Beam to Suntory on terms preferential to defendants and other Beam insiders and to subvert the interests of plaintiff and the other public stockholders of the company.”
They are also claiming that the acquisition has undervalued Beam, and that Founder and CEO of the hedge fund firm, Pershing Square Capital Management, William Ackman, is the driving force behind the move. Ackman owns around 13 per cent of the shares and stands to receive over $1.73 billion if the buyout goes ahead. The suit claims that Ackman is doing so because he lost around $1 billion in investments with J.C. Penney Co. and Herbalife.
However, Ackman and Pershing Square have not been named as defendants, and the suit is being filed solely against both Suntory Holdings and Beam Inc.
It appears that there’s an email from Beam spokesperson, Clarkson Hine, that claims that the lawsuit is “baseless and without merit.”
We’ll be sure to keep you updated on this situation as things develop.
Read more about Courvoisier Cognac here.
Sources: thespiritsbusiness.com, pionline.com, dailyherald.com