Attorneys swoop into action on K-Tron deal…

January 12, 2010

Yesterday, Hillenbrand (HI) announced that it was buying K-Tron (KTII) for around $435 million or $150 a share. Given that K-Tron closed at $113 a share on Friday, one would think there would be lots of celebrating, given the 32% appreciation in the stock.

But that’s not exactly the case. Indeed, by the end of the day, at least three law firms had already put out press releases announcing that they were investigating a breech of fiduciary duty by K-Tron’s board (here’s a link to one release). Several other law firms quickly threw up web pages (see here and here) — fueled by strategically placed Google ads (just do a search for K-Tron) — encouraging K-Tron investors to get in touch with the various firms.

Granted, K-Tron stock peaked at just over $160 a share in August 2008. But things have changed dramatically since then. And while we don’t have a particularly strong opinion one way or the other on whether this deal makes sense, unlike some of the other deals we’ve seen recently (think Xerox and ACS, for example), it seems hard to argue — at least on the surface — that ordinary investors are getting the shaft here.

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