Argo Group International Holdings – purported shareholders of which have filed lawsuits and sent demand letters in respect of the company’s merger deal with Brookfield Reinsurance – has described the claims as having no merit.
In a US Securities and Exchange Commission filing, Argo noted: “On March 7, 2023, March 8, 2023, March 28, 2023, March 29, 2023, and April 1, 2023, complaints were filed alleging, among other things, that the proxy statement [for the merger agreement] omitted material information that rendered it incomplete or misleading.
“The lawsuits, each filed by a purported shareholder of the company in an individual capacity and/or on behalf of all others similarly situated, were filed in federal court… As a result of the alleged omissions, one or more of the lawsuits seek to hold the company and/or its directors liable for violating Sections 14(a) and/or 20(a) of the Securities Exchange Act of 1934, as amended, as well as Rule 14a-9 promulgated thereunder.”
According to Argo, the relief sought in one or more of the complaints includes enjoining the consummation of the merger unless and until certain allegedly material information is disclosed.
Similarly, separate demand letters are alleging that the proxy statement omitted material information that rendered it false and misleading or otherwise had disclosure deficiencies in violation of federal securities laws.
In response, Argo stated: “The company believes that the claims brought in the complaints and the demand letters are without merit and that no supplemental disclosure is required under applicable laws.
“However, in order to reduce the risk of the complaints or demand letters delaying or adversely affecting the merger or the other transactions contemplated by the merger agreement and to minimise the costs, risks, and uncertainties inherent in litigation, and without admitting any liability or wrongdoing, the company has determined to voluntarily supplement the proxy statement by providing additional information.”
Under the merger agreement, Brookfield Reinsurance is acquiring Argo in an all-cash transaction valued at approximately US$1.1 billion.
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