Robbins Arroyo LLP: Acquisition of Genworth Financial, Inc. (GNW) by China Oceanwide Holdings Group Co., Ltd. May Not Be in S...
October 25 2016 - 1:22PM
Business Wire
Shareholder rights attorneys at Robbins Arroyo LLP are
investigating the proposed acquisition of Genworth Financial, Inc.
(NYSE: GNW) by China Oceanwide Holdings Group Co., Ltd. On October
23, 2016, the two companies announced the signing of a definitive
merger agreement pursuant to which China Oceanwide will acquire
Genworth Financial. Under the terms of the agreement, Genworth
Financial shareholders will receive $5.43 in cash for each share of
Genworth Financial common stock.
View this information on the law firm's Shareholder Rights Blog:
www.robbinsarroyo.com/shareholders-rights-blog/genworth-financial-inc-oct-2016
Is the Proposed Acquisition Best for Genworth Financial and
Its Shareholders?
Robbins Arroyo LLP's investigation focuses on whether the board
of directors at Genworth Financial is undertaking a fair process to
obtain maximum value and adequately compensate its
shareholders.
As an initial matter, the $5.43 merger consideration represents
a premium of only 4.2% based on Genworth Financial's closing price
on October 22, 2016. This premium is significantly below the
average one day premium of nearly 46.27% for comparable
transactions within the past three years. In the last three years,
Genworth Financial traded as high as $18.74 on May 13, 2014, and
most recently traded above the merger consideration – at $5.44 – on
August 11, 2015.
On August 2, 2016, Genworth Financial reported earnings results
for its second quarter 2016. Net operating income for the second
quarter of 2016 was $123 million, or $0.25 per diluted share,
compared with net operating income of $119 million, or $0.24 per
diluted share, in the second quarter of 2015, a 3.4% increase.
During the second quarter of 2016, Genworth Financial completed the
sale of its European Mortgage Insurance ("MI") business to AmTrust
Financial Services, Inc., which resulted in net proceeds of
approximately $50 million to the U.S. MI business. Genworth
Financial beat consensus analyst estimates for Adjusted Net Income
in three out of the last four quarters. In commenting on these
results, Genworth Financial President and Chief Executive Officer
Tom McInerney remarked, "Our results in the second quarter were
solid, and we were especially pleased with the strong performance
in U.S. MI. We also achieved our cash expense reduction target and
remain on track to complete the repatriation of our Bermuda
subsidiary in the fourth quarter."
In light of these facts, Robbins Arroyo LLP is examining
Genworth Financial'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.
Genworth Financial 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. Genworth Financial 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.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20161025006457/en/
Robbins Arroyo LLPDarnell R. Donahue(619) 525-3990 or Toll Free
(800) 350-6003ddonahue@robbinsarroyo.comwww.robbinsarroyo.com
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