In September, an eminently recognizable footwear company changed hands — and went private as a result. Specifically, 3G Capital announced its purchase of Sketchers on September 12, which also marked the end of Sketchers’ days as a publicly traded company. With that deal’s completion now in the rear view mirror, details are beginning to emerge about how existing Sketchers shareholders fared as a result, and it turns out that not everyone is thrilled.
That’s led some Sketchers stockholders to file a lawsuit. As Caroline Petrow-Cohen reports at the Los Angeles Times, the suit argues that the price of $63 that 3G Capital paid Sketchers shareholders was too low, and resulted in stockholders being underpaid for their holdings.
One of the issues at play here is the effect of U.S. tariff policy, which affected Sketchers’ stock price as the deal was coming together. Earlier this week, Bloomberg‘s Sabrina Willmer reported that the same group of investors had originally sought a settlement with Sketchers. In related reporting, Tom Hals at Reuters noted that several hedge funds were among the entities bringing the lawsuit. Hals writes that “[a]t least five separate cases” related to the sale of the company are now in the works.
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10 labels proving that we just hit peak GORP 2.0Reuters’ update on the legal case also pointed out that the terms of 3G Capital’s acquisition was a factor, noting that Sketchers stockholders did not vote on whether or not to approve the deal. Instead, Hals writes that the sale was approved by the family of Sketchers founder Robert Greenberg, which controls a majority of the company’s shares. How these cases will play out over the coming months (and perhaps years) remains a legal conundrum to keep an eye on.
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