Harman shareholders file lawsuit to oppose Samsung deal
Samsung Electronics confirmed about a month ago that it’s going to acquire Harman International for around $8 billion. Samsung will bring in Harman’s automotive business as well as its premium audio brands through this acquisition but the company’s shareholders don’t appear to be in a mood to allow the deal to pass through easily. There were concerns that they might get in the way of things. Harman shareholders have now filed a class action lawsuit against the company’s CEO and board as they oppose the $8 billion deal with Samsung Electronics.
Latest media reports reveal that Harman shareholders have filed a lawsuit against CEO Dinesh Paliwal and the board in a Delaware court. The lawsuit alleges that the CEO and the board did not act in good faith when making the deal with Samsung. The shareholders believe that the company was sold for too low a value and thus causes financial damage to the shareholders. They’re also opposing Harman’s agreement not to look for a competing bidder.
The acquisition is only going to pass if more than 50 percent of Harman’s shareholders agree in a shareholders meeting that’s due in the first quarter of this year. US hedge fund Atlantic Investment Management owns a 2.3 percent stake in Harman and it has already said that it will vote against the deal as the price is too low. Many minor shareholders are expected to follow in the same direction which might make things hard for Samsung as it looks to close this deal soon.