Costa Inc. and Essilor International Merger May Not Be in Shareholders' Best
SAN DIEGO and LINCOLN, R.I., Nov. 11, 2013
SAN DIEGO and LINCOLN, R.I., Nov. 11, 2013 /PRNewswire/ -- Shareholder rights
attorneys at Robbins Arroyo LLP are investigating the proposed acquisition of
Costa Inc. (NASDAQ: ATX) by Essilor International (EPA: EI). Costa and
Essilor announced the signing of a definitive merger agreement pursuant to
which Essilor will acquire Costa. Under the terms of the agreement, holders
of Costa will receive $21.50 in cash for each share owned.
Is the Merger Best for Costa and Its Shareholders?
Robbins Arroyo LLP's investigation focuses on whether the board of directors
at Costa is undertaking a fair process to obtain maximum value and adequately
compensate Costa shareholders in the merger. As an initial matter, the $21.50
consideration represents a premium of only 7.6% based on Costa's closing price
on November 7, 2013. This premium is substantially below the median one-day
premium of 19.89% for comparable transactions in the last three years.
Further, the merger consideration is below the target price of $29.00 set by
an analyst at D.A. Davidson & Co. and the $27.00 price set by an analyst at
Benchmark Company LLC. In addition, Costa is currently experiencing success
and growth in its business prospects, as indicated in its October 30, 2013
press release announcing the company's financial results for its third quarter
2013. In particular, Costa reported:
oSales growth of 26.3% to $24.6 million, compared to $19.4 million for the
same quarter 2012;
oSales growth of 20.7% to $80.8 million, for the nine months ended
September 28, 2013 and;
oSunglass sales increase of 24.1% and accessories sales increase of 46.6%
Given these facts, Robbins Arroyo LLP is examining the Costa board of
directors' decision to sell the company to Essilor now rather than allow
shareholders to continue to participate in the company's continued success and
future growth prospects, and whether they are seeking to benefit themselves.
Costa 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 tender their shares in an informed manner.
Costa shareholders interested in information about their rights and potential
remedies can contact attorney 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 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.
Darnell R. Donahue
Robbins Arroyo LLP
(619) 525-3990 or Toll Free (800) 350-6003
SOURCE Robbins Arroyo LLP
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