Barclays Added as Defendant in Del Monte Shareholders Lawsuit

Del Monte Foods Co. shareholders added Barclays Capital, the company’s financial adviser, to a lawsuit seeking to stop a $5.3 billion takeover led by KKR & Co.

The shareholders’ law firm, Grant & Eisenhofer, told the Delaware Chancery Court of the move in a Feb. 18 letter. Also that day, Del Monte said it will seek takeover offers following a Delaware judge’s decision to delay the deal. Barclays had a conflict in handling the auction of the company because it also helped finance the KKR-led offer, the judge said.

Barclays said in an e-mailed statement that its sale process included 53 potential buyers for Del Monte and didn’t yield a higher price. The $19 a share price is 40 percent more than the average trading price for the three months prior to the possibility of a sale becoming public, Barclays said.

“We look forward to the opportunity to set the record straight in court,” Barclays said. Barclays Capital was not named as a defendant when the Delaware Chancery Court made its preliminary ruling on February 14, and as a result, has not had the opportunity to provide the court with all of the facts relating to its work for Del Monte or refute the plaintiffs’ version of events.”

The ruling by Judge J. Travis Laster postponed a shareholder vote of the KKR deal until March 7. Del Monte was sued in December by a shareholder seeking more than the $19 a share offered. A buyout would give New York-based KKR access to Del Monte’s pet-food business, which has more than doubled sales in the past four years.

Perella Weinberg Partners LP was hired to canvass potential bidders, San Francisco-based Del Monte said Feb. 18 in a regulatory filing.

The case is In re Del Monte Foods Co. Shareholder Litigation, CA6027, Delaware Chancery Court (Wilmington).

To contact the reporters on this story: Linda Sandler in New York at lsandler@bloomberg.net; Zachary R. Mider in New York at zmider1@bloomberg.net.

To contact the editor responsible for this story: John Pickering at jpickering@bloomberg.net.

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