San Diego, CA -- (SBWIRE) -- 05/04/2022 -- A former investor in shares of Smart & Final Stores Inc (formerly NYSE: SFS) filed a lawsuit over alleged breaches of fiduciary duties by certain executives of Smart & Final Stores Inc, its former majority owner and two of its financial advisors.

Former investors in shares of Smart & Final Stores Inc (formerly NYSE: SFS) have certain options and should contact the Shareholders Foundation at mail@shareholdersfoundation.com or call +1(858) 779 - 1554.

According to the complaint the plaintiff alleges that affiliates of Ares Management Corp., Citigroup Inc., and Jefferies Financial Group Inc., arranged an underpriced $497 million sale to Apollo Global Management Inc so Ares could meet its exit timeline and liquidate a multibillion-dollar fund.

The plaintiff says that in January of 2018, Apollo Global Management, LLC had made a proposal to Smart & Final's CEO, David G. Hirz, for a $400,000,000 investment to fund a tender offer to Smart & Final shareholders to purchase $200,000,000 of outstanding shares pro rata at $9.00 per share and $200,000,000 to repay debt, and that Hirz informed the Board of Smart & Final Stores Inc that Ares was not interested in the proposal, leading to its rejection in February.

The plaintiff says that in June 2018, Smart & Final, was presenting its shareholders and the public at large with a rosy picture.

The plaintiff says that the board repeated Ares' insistence that it did not 'need' to sell without disclosing that one of the Ares funds was at the end of its investment life cycle.

Then by April 2019, the plaintiff claims, professionals had aggressively contacted 74 parties, 38 of whom had executed a confidentiality agreement, eight had attended an in-person "fireside chat", seven attended a management presentation and submitted preliminary proposals, and four had submitted final proposals.

The plaintiff claims that the Board rejected out of hand a non-binding preliminary proposal to acquire Smart Foodservice Warehouse for eight times Adjusted EBITDA and, ultimately, declined a joint proposal at $7.00 per share by two buyers, each purchasing one of Smart & Final's two business segments.

The plaintiff alleges that the Board preferred the "relative speed and certainty" of a lower offer from Apollo Management IX, L.P., a subsidiary of Apollo, and structured the transaction as a medium-form merger, putting Ares in the driver's seat, and that that transaction closed at $6.50 per share for a deal value of approximately $497,342,378.

The plaintiff says that within two years of closing, Apollo then sold each segment to separate buyers for a combined $1.6 billion. On March 6, 2020, Apollo sold Smart Foodservice Warehouse to US Foods for $970,000,000 and on May 17, 2021, Apollo sold Smart & Final to Bodega Latina for $620,000,000 and the assumption of Smart & Final's remaining debt.

Those who purchased shares of Smart & Final Stores Inc (formerly NYSE: SFS), have certain options and should contact the Shareholders Foundation.

Contact:
Shareholders Foundation, Inc.
Christopher Clausen
3111 Camino Del Rio North - Suite 423
92108 San Diego
Phone: +1-(858)-779-1554
Fax: +1-(858)-605-5739
mail@shareholdersfoundation.com

About The Shareholders Foundation
The Shareholders Foundation, Inc. is a professional portfolio monitoring and settlement claim filing service, , which does research related to shareholder issues and informs investors of securities class actions, settlements, judgments, and other legal related news to the stock/financial market. Shareholders Foundation, Inc. is in contact with a large number of shareholders and offers help, support, and assistance for every shareholder. The Shareholders Foundation, Inc. is not a law firm. Referenced cases, investigation, and/or settlements are not filed/reached and/or related to Shareholders Foundation. The information is provided as a public service. It is not intended as legal advice and should not be relied upon.