Possible Breach of Fiduciary Duty in Sale of General Bearing Corp
Posted on Jan 01, 2016
A private investigation is being launched into the possible breach of fiduciary duty by the Board of Directors of General Bearing Corp. The company was recently sold to the Swedish company SKF Group in an all-cash deal worth just over $144 million. The negotiations have stated that the current value of each share of stock is worth $28.
The investigation will attempt to discover if they did enough to maximize the sale price of the company and get the highest possible share value for the company’s shareholders. The independent investigators will look at how the Board of Directors of General Bearing Corp. shopped the company around before agreeing to a deal, and whether or not they were able to secure the best deal for the company.
They will also seek to discover if the board acted in the best interest of its shareholders by agreeing to the deal, or if there is a possibility of a class action lawsuit for a breach of fiduciary duty by the board. A fiduciary relationship is one where a party (the shareholders) places its trust, well-being, and finances in the hands of another party (the board). If it is determined that the board failed to maximize profits for its shareholders, they could be in breach of their fiduciary duty.
Questions regarding this case and the potential impact on the stockholders, or other breach of fiduciary duty cases, can be directed to The Law Offices of Jonathan M. Cooper and their experienced New York business lawyers. Their book, When You Don’t Have a Written Agreement, is available to order for free online.