Too cheap? Class action suit filed seeking better price for Winn-Dixie shareholders in sale to Bi-Lo
In better days at Winn-Dixie: In 2007, Winn-Dixie CEO Peter Lynch gives the thumbs up while presiding over the opening bell from a re-opened Winn-Dixie New Orleans East Store devastated after Hurricane Katrina. Winn-Dixie's comeback as an independent company appears to be over. (Photo courtesy of Nasdaq.)
Wake up and good morning. The good news is that Jacksonville-based supermarket chain Winn-Dixie -- treading water in the best of recent times -- is being sold in a deal valued at $560 million to Bi-Lo LLC, creating a huge grocery operator in the South, in a deal announced Monday. Here's Winn-Dixie's press release and the AP coverage of the announced deal. Winn-Dixie, a public company, will become part of privately owned Bi-Lo, but will continue to operate as Winn-Dixie.
The bad news is that some Winn-Dixie shareholders feel the deal is too cheap and are suing for more money. According to Jacksonville's Times Union newspaper, local attorney Charles Jimerson, representing the shareholders, says the $9.50 per share offer is too low.
"The shares traded as high as $10.08 as recently as July," Jimerson told the Times Union. "There’s a couple of book value reportings around the $15 range. At least one analyst had it at $11. We think $9.50 is substantially below what the company is worth."
Jimerson would not say how many shareholders he represents. The lawsuit, filed in Jacksonville, only lists Arthur I. Murphy Jr. "on behalf of himself and others similarly situated," the newspaper story says. Jimerson is filing it as a class-action suit. Here's the Times Union story.
-- Robert Trigaux, Business Columnist, St. Petersburg Times, soon to be known as the Tampa Bay Times