BOULDER, Colo., Oct. 14, 2008 (GLOBE NEWSWIRE) -- Advertising Material -- The Shuman Law Firm today announced that it is investigating the proposed acquisition of Sovereign Bancorp, Inc. ("Sovereign" or the "Company") (NYSE:SOV).
On Oct. 14, 2008, Sovereign announced their intent to sell the Company to Banco Santander, a Spanish bank. Under the terms of the merger agreement, Sovereign shareholders would receive $3.81 in cash for every Sovereign share they tender, for a total sale price of approximately $1.9 billion in cash. The proposed acquisition is subject to customary conditions and regulatory approvals.
Santander purchased a 25% stake in Sovereign approximately three years ago. Under terms of that agreement, Santander was entitled to bid for Sovereign after May 31, 2008, but the Spanish bank had to offer at least $40 a share. That provision was later amended to $38 a share. These conditions were likely waived considering the $3.81 sale price. This ownership stake also allowed Santander to control three seats on Sovereign's Board virtually guaranteeing a sale to Santander at preferential terms. The $3.81 offer price provides no premium over Sovereign's close price of $3.81 on Friday, October 10th when rumors of the proposed merger began to surface. In fact, Sovereign common stock has traded as high as $10.23 in the past month. These facts, taken together with other provisions in the merger agreement, may result in damage to Sovereign shareholders by impeding the maximization of shareholder value.
If you currently own Sovereign common stock and would like a free consultation concerning your rights and interests, please contact Kip Shuman, Esq. or Rusty Glenn, Esq. toll-free at 866-974-8626 or email Mr. Shuman at kip@shumanlawfirm.com or Mr. Glenn at rusty@shumanlawfirm.com.
The Shuman Law Firm represents investors throughout the nation, concentrating its practice in securities class actions and shareholder derivative litigation.
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