WMS Industries Inc., the Waukegan-based maker of gaming and video-lottery machines, was sued by a shareholder over claims the company’s proposed $1.5 billion acquisition by Scientific Games Corp. is unfair.
The proposed deal is the product of an “opportunistic process” in which WMS directors “unreasonably” agreed to an unfair price, lawyers for WMS investor David Shaev said in a complaint made public today in Delaware Chancery Court. The complaint, which seeks to bar the transaction, also names Scientific Games as a defendant.
“There is no indication that the purchase price adequately reflects the many synergies that would result from the merger of the two companies,” lawyers for Shaev said in the complaint. “The structure of the proposed acquisition does not provide for adequate value for the company.”
Scientific Games, which is 38 percent owned by billionaire Ron Perelman, announced Jan. 31 that it would pay $26 a share to acquire WMS to expand its offerings for casinos. The deal is the biggest announced in leisure and recreational products in almost two years, according to data compiled by Bloomberg. The combination would create a global supplier of lottery equipment and slot machines.
Shaev accused WMS directors of failing to reject the inadequate offer and failing to seek other potential bidders for the company. Those actions artificially depressed the value of WMS stock, according to the complaint.
Shaev is seeking to represent all WMS shareholders in his bid for a court order blocking the deal.
Aimee Remey, a Scientific Games spokeswoman, and Mollie Cole, a spokeswoman for WMS, didn’t immediately return phone and e-mail messages seeking comment on the complaint.Copyright © 2013 Paddock Publications, Inc. All rights reserved.