Savvis Inc., which provides online business data storage, was sued in Delaware Chancery Court by an investor who contends a $2.5 billion cash-and-stock buyout offer from phone company CenturyLink Inc. (CTL) is inadequate.
Stockholder Hilary Kramer claims Savvis directors violated their duties by failing to get the best possible price and seeks an injunction to stop the deal, according to a complaint filed yesterday in Wilmington.
“Defendants failed to explore strategic alternatives to a buyout notwithstanding Savvis’ bright prospects for growth and profitability” in advanced “cloud” computer-data hosting services, Kramer said in the filing.
Town & Country, Missouri-based Savvis, 18 percent owned by the Welsh Carson Anderson & Stowe venture capital firm of New York, reported $933 million in revenue last year.
Savvis and Monroe, Louisiana-based CenturyLink announced the buyout agreement April 27, with Savvis stockholders to receive $30 in cash and $10 in CenturyLink shares for each of their shares, an 11 percent premium at the time.
Savvis rose 2 cents to $39.29 at 9:41 a.m. New York time in Nasdaq Stock Market trading. The stock has risen more than 50 percent this year.
Matt Benson, a spokesman for Savvis in San Francisco, didn’t immediately return phone and e-mail messages seeking comment on the lawsuit.
The case is Hilary Kramer v. James E. Ousley and Savvis Inc. (SVVS), CA6438, Delaware Chancery Court (Wilmington).
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