Focus Financial Partners, Inc.
The law firm of Kirby McInerney LLP announces that a class action lawsuit has been filed in the U.S. District Court for the District of Delaware on behalf of (1) those who sold Focus Financial Partners, Inc. ("Focus Financial” or the “Company”) (NASDAQ: FOCS) securities during the period from February 27, 2023 through the closing of the take-private acquisition of Focus Financial by Clayton, Dubilier & Rice, LLC ("CD&R") on August 31, 2023, and (2) those who held Focus Financial common stock on the June 9, 2023 record date for the Merger who were entitled to vote on the Merger. Investors have until March 4, 2024 to apply to the Court to be appointed as lead plaintiff in the lawsuit.
Prior to the Merger, private equity firm Stone Point Capital LLC ("Stone Point") held approximately 20.6% of Focus Financial's voting power and appointed two members to the Company's board of directors (the "Board"). The complaint alleges Defendants materially misrepresented the sale process leading up to the Merger by, among other things, omitting that they failed to adequately solicit potential strategic acquirers for Focus Financial.
Contrary to Defendants' public statements concerning the Merger, including in the definitive shareholder proxy statement filed on June 12, 2023, the sale process allegedly was not thorough because strategic buyers were not adequately canvassed by Defendants, the one strategic buyer that broke through was denied critical due diligence, and its higher-priced merger proposal was rejected. As alleged in the complaint, Stone Point preferred a transaction with CD&R, as opposed to the strategic acquirer that was prepared to offer more to Focus shareholders, given Stone Point's interest in obtaining a more lucrative equity rollover into a private equity firm.
Moreover, while Defendants portrayed a robust arms-length negotiating process overseen by a purportedly independent and disinterested special committee of the Focus Board (the Special Committee), the Special Committee members were allegedly not disinterested nor independent given the personal financial windfall they received under the Merger. The complaint further alleges that the Special Committees financial advisor on the Merger, Goldman Sachs & Co. LLC, suffered from numerous conflicts of interest that served to limit the pool of potential acquirors considered by the Special Committee. As alleged in the complaint, the belated proxy supplement issued a mere six business days before the shareholder vote on the Merger also did not cure Defendants misstatements.
Prior to the Merger, private equity firm Stone Point Capital LLC ("Stone Point") held approximately 20.6% of Focus Financial's voting power and appointed two members to the Company's board of directors (the "Board"). The complaint alleges Defendants materially misrepresented the sale process leading up to the Merger by, among other things, omitting that they failed to adequately solicit potential strategic acquirers for Focus Financial.
Contrary to Defendants' public statements concerning the Merger, including in the definitive shareholder proxy statement filed on June 12, 2023, the sale process allegedly was not thorough because strategic buyers were not adequately canvassed by Defendants, the one strategic buyer that broke through was denied critical due diligence, and its higher-priced merger proposal was rejected. As alleged in the complaint, Stone Point preferred a transaction with CD&R, as opposed to the strategic acquirer that was prepared to offer more to Focus shareholders, given Stone Point's interest in obtaining a more lucrative equity rollover into a private equity firm.
Moreover, while Defendants portrayed a robust arms-length negotiating process overseen by a purportedly independent and disinterested special committee of the Focus Board (the Special Committee), the Special Committee members were allegedly not disinterested nor independent given the personal financial windfall they received under the Merger. The complaint further alleges that the Special Committees financial advisor on the Merger, Goldman Sachs & Co. LLC, suffered from numerous conflicts of interest that served to limit the pool of potential acquirors considered by the Special Committee. As alleged in the complaint, the belated proxy supplement issued a mere six business days before the shareholder vote on the Merger also did not cure Defendants misstatements.