San Diego, CA -- (SBWIRE) -- 07/09/2012 -- An investor in NASDAQ:MODL shares filed a lawsuit in State Court against members of the board of directors of MModal Inc in effort to block the proposed takeover of MModal Inc at $14 per NASDAQ:MODL share.
Investors who purchased shares of MModal Inc (NASDAQ:MODL) prior to July 2, 2012, and currently hold any of those NASDAQ:MODL shares have certain options and should contact the Shareholders Foundation at mail(at)shareholdersfoundation.com or call +1(858) 779 - 1554.
The plaintiff alleges that the defendants breached their fiduciary duties arising out of the attempt to sell the company too cheaply via an unfair price to One Equity Partners.
On July 2, 2012, MModal Inc. (NASDAQ/GS: MODL) and One Equity Partners announced that they have entered into an agreement pursuant to which One Equity Partners, the private investment arm of JP Morgan Chase & Co., will acquire all of the outstanding shares of M*Modal for $14.00 per share in an all-cash transaction. The transaction is valued at approximately $1.1 billion.
However, the plaintiff says that the $14offer is unfair to NASDAQ:MODL stockholders as it undervalues the company. In fact, at least one analyst has set the high target price for NASDAQ:MODL shares at $16 per share, thus above the current $14offer. Furthermore, MModal Inc has performed well for its investors in the past. Its annual Revenue increased from $171.41million in 2008 to $443.80million in 2011 and its Net Loss of $113.67million in 2008 turned into a Net Income of $62.80million in 2011.
In addition, the plaintiff alleges that the process is also unfair to MModal investors. In fact, certain investment funds affiliated with S.A.C. Private Capital Group LLC (S.A.C. PCG), collectively M*Modal's largest shareholder owning approximately 31% of M*Modal's outstanding shares in the aggregate, have already agreed to tender their shares into the offer and to support the transaction.
Those who are current investors in MModal Inc (NASDAQ:MODL) and purchased their MModal Inc shares prior to the announcement, have certain options and should contact the Shareholders Foundation.
Shareholders Foundation, Inc.
3111 Camino Del Rio North - Suite 423
92108 San Diego