Berman Tabacco represented Oklahoma Firefighters Pension and Retirement System as a member of the Plaintiffs’ Executive Committee in a case alleging breach of fiduciary duty by the board of beauty and personal care products manufacturer Alberto-Culver. The case stemmed from Unilever NV’s proposed $3.7 billion all-cash takeover of Alberto-Culver, announced September 27, 2010, which left Alberto-Culver shareholders with $37.50 per share.
Plaintiffs alleged that the Alberto-Culver board failed to perform a market check prior to the merger and improperly structured the proposed transaction to unfairly favor Unilever, its preferred acquirer. Among other things, the proposed merger agreement restricted the Alberto-Culver board’s ability to contact potential alternative bidders and gave Unilever unlimited matching rights that would serve to deter other companies from making competitive bids for Alberto-Culver. These provisions potentially resulted in Alberto-Culver shareholders receiving inadequate consideration for their shares.
As a member of the Executive Committee, the firm helped Alberto-Culver shareholders achieve a November 29, 2010 settlement in which both companies agreed to delay votes on the merger to enable consideration of other potential bidders, as well as to modify disclosures in the proxy statement provided to Alberto-Culver shareholders. Plaintiffs successfully obtained additional concessions in which Alberto-Culver’s board eliminated the unlimited matching rights it had granted to Unilever, and lowered the break-up fee from $125 million to $100 million and allowed Alberto-Culver to share the same confidential information it provided to Unilever with any superior bidder. Chancellor Leo E. Strine Jr. of the Delaware Court of Chancery approved the settlement on February 21, 2011.