Robbins Arroyo LLP: Acquisition of Covance Inc. (CVD) by Laboratory Corporation of America Holdings (LH) May Not Be in Shareholders' Best Interests
SAN DIEGO and PRINCETON, N.J., Nov. 4, 2014 /PRNewswire/ -- Shareholder rights attorneys at Robbins Arroyo LLP are investigating the proposed acquisition of Covance Inc. (NYSE: CVD) by Laboratory Corporation of America Holdings (NYSE: LH). On November 3, 2014, the two companies announced the signing of a definitive merger agreement pursuant to which Covance shareholders will receive 0.2686 Laboratory Corporation shares and $75.76 per share in cash and for each share of Covance owned, for a total consideration of $105.12.
View this information on the law firm's Shareholder Rights Blog: www.robbinsarroyo.com/shareholders-rights-blog/covance-inc
Is the Proposed Acquisition Best for Covance and Its Shareholders?
Robbins Arroyo LLP's investigation focuses on whether the board of directors at Covance is undertaking a fair process to obtain maximum value and adequately compensate its shareholders.
As an initial matter, the proposed consideration represents a premium of 31.6% based on Covance's closing price on October 31, 2014. This premium is significantly below the average one-day premium of over 41% for comparable transaction within the past year. Further, on November 3, 2014, Covance released its third quarter 2014 earnings, reporting strong quarterly results. In particular, Covance reported net revenue of $627 million, representing a 3.4% increase over the third quarter of 2013. Also noteworthy is that the company's pro forma operating income increased 16.4% over the same quarter of 2013 to $33.5 million. Pro forma earnings per diluted share of $0.98 also increased 18.2% over the third quarter of 2013. In commenting on these results, Joe Herring, Chairman and Chief Executive Officer, remarked, "Commercial performance in the quarter was solid, with third quarter adjusted net orders of $752 million resulting in an adjusted net book-to-bill of 1.20 to 1."
In light of these facts, Robbins Arroyo LLP is examining Covance's board of directors' decision to sell the company now rather than allow shareholders to continue to participate in the company's continued success and future growth prospects.
Covance shareholders have the option to file a class action lawsuit to ensure the board of directors obtains the best possible price for shareholders and the disclosure of material information. Covance shareholders interested in information about their rights and potential remedies can contact attorney Darnell R. Donahue at (800) 350-6003, [email protected], or via the shareholder information form on the firm's website.
Robbins Arroyo LLP is a nationally recognized leader in securities litigation and shareholder rights law. The law firm represents individual and institutional investors in shareholder derivative and securities class action lawsuits, and has helped its clients realize more than $1 billion of value for themselves and the companies in which they have invested.
Attorney Advertising. Past results do not guarantee a similar outcome.
Contact:
Darnell R. Donahue
Robbins Arroyo LLP
600 B Street, Suite 1900
San Diego, CA 92101
[email protected]
(619) 525-3990 or Toll Free (800) 350-6003
www.robbinsarroyo.com
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SOURCE Robbins Arroyo LLP
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