Acquisition of Ebix, Inc. by an affiliate of Goldman, Sachs & Co. May Not Be
in the Best Interests of Ebix Shareholders
SAN DIEGO and ATLANTA, May 2, 2013
SAN DIEGO and ATLANTA, May 2, 2013 /PRNewswire/ --Shareholder rights
attorneys at Robbins Arroyo LLP are investigating the acquisition of Ebix,
Inc. (NASDAQ: EBIX) by Goldman, Sachs & Co. On May 1, 2013, Ebix announced
that it had entered into a definitive merger agreement whereby Ebix
shareholders will receive $20.00 in cash for each share.
The Board of Directors' Actions May Prevent Ebix Shareholders from Receiving
Maximum Value for Their Stock
Robbins Arroyo LLP's investigation focuses on whether the board of directors
at Ebix is undertaking a fair process to obtain maximum value and adequately
compensate its shareholders in the merger or whether they are seeking to
The $20.00 merger consideration represents a premium of only 7.47% based on
Ebix's closing price on April 30, 2013, the last trading day prior to the
merger announcement. The 7.4% premium is substantially below the median
premium of 35.47% for comparable transactions over the past three years.
Further, the $20.00 offer price is substantially below the target price of
$25.00 set by an analyst at BOE Securities on September 13, 2012, and a target
price of $24.00 set by an analyst at Craig-Hallum on March 13, 2013.
Is the Acquisition Best for Ebix and Its Shareholders?
On March 14, 2013, Ebix released its 2012 financial results reflecting record
revenue growth. Specifically, Ebix reported fourth quarter revenue of $54.0
million an increase of 22.6% as compared to the same quarter 2011. Further,
Ebix reported full year revenue increased to $199.4, an 18% increase over
2011. Moreover, earnings per share for the fourth quarter 2012 increased 9%,
to $0.48 per share. In announcing these results, Robin Raina, Ebix's
Chairman, President, and CEO, stated, "The Company's 2012 results reflect the
strength of Ebix's core business that helped us deliver outstanding results in
one of the most challenging years for the insurance industry in a decade. Our
revenue, operating cash flow, liquidity and diluted EPS were all at record
levels as we look forward to continued high levels of performance in 2013."
Given these facts, the firm is examining the board of directors' decision to
sell Ebix now rather than allow shareholders to continue to participate in the
company's continued success and future growth prospects.
Ebix shareholders have the option to file a class action lawsuit to secure the
best possible price for shareholders and the disclosure of material
information so shareholders can vote on the transaction in an informed manner.
Ebix shareholders interested in information about their rights and potential
remedies can contact Darnell R. Donahue at (800) 350-6003,
firstname.lastname@example.org, or via the shareholder information form on the
Robbins Arroyo LLP is a nationally recognized leader in securities litigation
and shareholder rights law. The 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. For more information, please
go to http://www.robbinsarroyo.com.
Press release link:
Attorney Advertising.Past results do not guarantee a similar outcome.
Darnell R. Donahue
Robbins Arroyo LLP
(619) 525-3990 or Toll Free (800) 350-6003
SOURCE Robbins Arroyo LLP
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