An investor with shares in Lender Processing Services Inc. (LPS) has reportedly filed a lawsuit in an effort to stop the takeover of the company by Fidelity National Financial (FNF).
According to a report on SBWire.com, the investor alleges that the defendants breached their fiduciary duties to LPS stockholders by agreeing to sell the company for less than its current worth.
As per the acquisition deal announced in May, financial data processing firm FNF is to acquire all of the outstanding common stock of mortgage and consumer loan processing services firm LPS for $33.25-per-share, for a total equity value of approximately $2.9 billion, using 50% cash and 50% FNF common stock.
However, the investor claims the $33.25 per share offer is too low and undervalues the company.
At least one analyst has set the high target price for LPS shares at $36.00 per share, according to the SBWire.com report.
The investor points out that LPS' reported annual total revenue rose from about $1.98 billion in 2011 to more than $1.99 billion in 2012. What's more, shares in LPS increased from $13.69 per share in September 2011 to $29.64 per share in October 2012.
LPS was spun out of FNF in 2008. As such, the deal, if approved, will bring LPS back under the umbrella of FNF.
