By PETER HUSSMANN
The six class action lawsuits filed in connection with Windstream's takeover of Iowa Telecom were settled and dismissed in an order filed Thursday in Jasper County District Court.
Judge Gregory Hulse approved the settlement agreement reached between the parties, ordered the cases dismissed and awarded more than a half million dollars in attorneys fees to be paid by Iowa Telecom and Windstream.
Thursday's final settlement hearing date was set in an order entered in June.
The six individual class action lawsuits claimed Iowa Telecom and Windstream, as well as the company board members, breached their fiduciary duties to shareholders in agreeing to the merger. The actions were filed in both Jasper County District Court and the Federal Court for the Southern District of Iowa.
In agreeing to settle the case, Iowa Telecom and Windstream made no admission or concession of the truth of any of the allegations. However, the attorneys for the plaintiffs were allowed to review and comment on a revised securities registration form filed in connection with the merger that included information not contained in the initial form filed with the Securities and Exchange Commission as part of the merger.
"Additional disclosures provided shareholders with material information concerning the synergies Windstream will benefit from as a result of the acquisition, Windstream's anticipated debt leverage ratio if the acquisition is consummated and Windstream's plans for Iowa Telecom's Iowa-based employees, including the fact that did not anticipate making any material staffing changes locally in Newton, Iowa," a court filing entered as part of the final dismissal states.
In addition, the filing states, shareholders were provided additional information on the potential benefits company insiders would receive as a result of the merger.
The settlement does not provide for any additional benefits to shareholders other than what was previously agreed to under the terms of the $1.2 billion merger deal that was completed on June 1.
Iowa Telecom shareholders received 0.804 shares of Windstream stock and $7.90 in cash per each Iowa Telecom share in the transaction. Windstream issued approximately 26.7 million shares of stock valued at $284 million, based on the company's closing price on May 28, and paid approximately $260 million in cash as part of the transaction.
Windstream also repaid all of Iowa Telecom's outstanding debt, which was approximately $613 million.
Judge Hulse dismissed the few shareholder objections filed in connection with the proposed settlement.
Attorneys representing the plaintiffs in the class action suits will be paid a total of $525,000. Sanjay Israni, a shareholder who filed a lawsuit against the merger in federal court in Des Moines, will be paid $3,000 from that amount for his representation of the class.
Recent Comments