Shareholder rights attorneys at Robbins Arroyo LLP are investigating
the proposed acquisition of Fidelity & Guaranty Life (NYSE: FGL) by
Anbang Insurance Group Company Limited. On November 9, 2015, the two
companies announced the signing of a definitive merger agreement
pursuant to which Anbang will acquire Fidelity. Under the terms of the
agreement, Fidelity shareholders will receive $26.80 in cash for each
share of Fidelity common stock.
View this information on the law firm's Shareholder Rights Blog: www.robbinsarroyo.com/shareholders-rights-blog/fidelity-guaranty-life
Is the Proposed Acquisition Best for Fidelity and Its Shareholders?
Robbins Arroyo LLP's investigation focuses on whether the board of
directors at Fidelity is undertaking a fair process to obtain maximum
value and adequately compensate its shareholders.
As an initial matter, the $26.80 merger consideration represents a
premium of only 26.4% based on Fidelity's one-week average closing price
prior to Fidelity's public announcement of its strategic review process
on April 6, 2015. This premium is significantly below the average
one-week premium of nearly 65% for comparable transactions within the
past three years. Further, the $26.80 merger consideration is
significantly below the target price of $30.00 set by analysts at both
Macquarie on July 22, 2015, and Sandler O'Neill & Partners LP on October
8, 2015. In the last three years, Fidelity traded as high as $27.87 on
October 23, 2015, and most recently traded above the merger
consideration – at $26.83 – on November 2, 2015.
On August 5, 2015, Fidelity reported strong earnings results for its
third quarter 2015. Net income for the quarter was $86 million, an
increase of 51% compared to the same period last year. Average assets
under management for the quarter were $18 billion, an increase of 8.3%
compared to the same period last year. Additionally, Fidelity has beat
consensus analyst estimates for sales in three out of its past four
quarters. In commenting on these results, Fidelity President and Chief
Executive Officer Chris Littlefield remarked, "Our business continues to
grow with fixed indexed annuity sales, indexed universal life sales and
assets under management all up significantly over last year. More
importantly, we're generating this growth while achieving our targeted
spreads and new business profitability measures. While adjusted
operating income is below our expectations due to lower SPIA mortality
and increased costs associated with the strategic review process, the
overall fundamentals of our business remain solid and we are
well-positioned to continue to deliver value for our distribution
partners, policy owners and shareholders."
In light of these facts, Robbins Arroyo LLP is examining Fidelity'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.
Fidelity 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. Fidelity
shareholders interested in information about their rights and potential
remedies can contact attorney Darnell R. Donahue at (800) 350-6003, ddonahue@robbinsarroyo.com,
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.
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