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| Protecting the Rights of Shareholders and Consumers |
PMA Capital Corporation Securities Litigation
Copyright ©2009 Levi & Korsinsky, LLP
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PMA Capital Corporation (NasdaqGS: PMACA) shareholder litigation in connection
with alleged unfair takeover offer
On June 10, 2010, PMA Capital Corporation (“PMA Capital” or the “Company”)
announced that it had agreed to sell the Company to Old Republic International
Corporation (“Old Republic”) (NYSE:ORI). Under the terms of the transaction, PMA
Capital shareholders will receive 0.55 shares of Old Republic common stock in
exchange for each outstanding common share of PMA Capital, which exchange rate
may be adjusted upwards or downwards depending on the price of Old Republic’s
common stock preceding the closing of the merger, but will not exceed 0.60 or be
less than 0.50. Based on the prior closing price of Old Republic, the transaction
values PMA capital stock at approximately $7.10 per share for a total transaction value
of $365 million, including the assumption of debt.
The investigation concerns whether the PMA Capital Board of Directors breached their
fiduciary duties to PMA Capital stockholders by failing to adequately shop the
Company before entering into this transaction and whether Old Republic is
underpaying for PMA Capital shares, thus unlawfully harming PMA Capital
stockholders. In particular, PMA Capital shares traded at $7.65 as recently as May 13,
2010, the Company has a book value of $12.97 per share and at least one analyst set
a price target for PMA Capital stock at $11.00 per share.
with alleged unfair takeover offer
On June 10, 2010, PMA Capital Corporation (“PMA Capital” or the “Company”)
announced that it had agreed to sell the Company to Old Republic International
Corporation (“Old Republic”) (NYSE:ORI). Under the terms of the transaction, PMA
Capital shareholders will receive 0.55 shares of Old Republic common stock in
exchange for each outstanding common share of PMA Capital, which exchange rate
may be adjusted upwards or downwards depending on the price of Old Republic’s
common stock preceding the closing of the merger, but will not exceed 0.60 or be
less than 0.50. Based on the prior closing price of Old Republic, the transaction
values PMA capital stock at approximately $7.10 per share for a total transaction value
of $365 million, including the assumption of debt.
The investigation concerns whether the PMA Capital Board of Directors breached their
fiduciary duties to PMA Capital stockholders by failing to adequately shop the
Company before entering into this transaction and whether Old Republic is
underpaying for PMA Capital shares, thus unlawfully harming PMA Capital
stockholders. In particular, PMA Capital shares traded at $7.65 as recently as May 13,
2010, the Company has a book value of $12.97 per share and at least one analyst set
a price target for PMA Capital stock at $11.00 per share.
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