in Newswire Published on November 22, 2017

Inventure Foods, Board Members Hit with Securities Lawsuits Over Company’s Sale to Utz

by Corrado Rizzi

Last Updated on May 8, 2018

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Schoenfield v. Inventure Foods, Inc. et al

Filed: November 20, 2017 ◆§ 2:17-cv-04274-DGC

• Read Complaint

Five lawsuits were filed against Inventure Foods and its board of directors this week over a slew of alleged securities law violations.

Defendant(s)

Inventure Foods

Law(s)

The Securities Exchange Act of 1934

State(s)

Arizona

Categories

Food Securities

Inventure Foods, Inc. and its six-member board of directors find themselves as the defendants in five proposed class action lawsuits filed on November 20 and 21 in connection with the board’s attempt to sell Inventure to Utz Quality Foods, LLC and Heron Sub, Inc. The lawsuits, filed in Arizona, allege the defendants violated federal securities laws by issuing materially false and/or misleading information regarding the deal – specifically the details of Inventure’s financial projections and valuation analyses performed by a third-party advisor. 

The complaints argue the defendants’ failure to properly disclose such information in the company’s November 15, 2017 Schedule 14D-9 Solicitation/Recommendation Statement filed with the U.S. Securities and Exchange Commission leaves stockholders with an incomplete picture as to whether they should tender their Inventure stock shares as per the October 2017 offer of $4.00 per share. 

Among other claims, the lawsuits allege: 

  • The financial analyses done by Rothschild Inc., Inventure’s financial advisor, “highlight how grossly inadequate” the offer price is for the company;
  • The aforementioned Recommendation Statement fails to disclose the details of any employment-related discussions between the defendants and Utz;
  • That the defendants’ processes behind Inventure’s sale to Utz were “flawed, inadequate, and conducted out of the self-interest” of the individual board members; and
  • That the compensation afforded to stockholders under the proposed acquisition significantly undervalues Inventure while failing to take into consideration how the company is performing.

    • The complaints can be read below.

    Schoenfield v. Inventure Foods, Inc. et al.; 2:17-cv-04274-DGC

    Shaoul v. Inventure Foods, Inc. et al.; 2:17-cv-04261-DGC

    Schoenfeld v. Inventure Foods, Inc.; 2:17-cv-04273-JAT

    D&S Fraley Revocable Living Trust v. Inventure Foods, Inc. et al.; 2:17-cv-04277-SPL

    Smith v. Inventure Foods, Inc. et al.; 2:17-cv-04256-SPL

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    Last Updated on May 8, 2018 — 6:01 PM

    Corrado Rizzi

    corrado@classaction.org

    Corrado Rizzi is the Senior Managing Editor of ClassAction.org.

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