PRUDENT REAL ESTATE TRUST V. JOHNCAMP REALTY, INC.
599 F.2d 1140 (2nd Cir. 1979)
NATURE OF THE CASE: This was an action to enjoin a tender offer because of allegedly
insufficient compliance with the Williams Act.
FACTS: Johncamp (D) filed a 14D-1 for a tender offer of any and all of Prudent's (P)
shares at $7 per share. This offer was not conditioned upon any minimum number of shares
being tendered and the market price before the filing was 4 and7/8. The filing stated that
80% of the required funds would be furnished by Johncamp N.V. which would obtain them from
Campeau out of a bank line of credit for $50,000,000 (Canadian). The remaining 20% would
come from Pacific the other owner of D. D was a close Delaware corporation owned by Johncamp
N.V. (60%) and Pacific (40%). All of N.V. was owned by Campeau Corporation. Wertin, was the
owner of Pacific and also a development corporation under his name. The plan was to get as
much stock of P as possible and if at least 2/3rds were received, D would as a minimum
liquidate the company. P sought to enjoin D from proceeding with the tender offer for the
failure to disclose in the 14D schedule any financial information about Pacific and Wertin.
The lower court refused to issue an injunction. P appealed.
ISSUE:
RULE OF LAW:
HOLDING AND DECISION:
LEGAL ANALYSIS:
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