Wright Medical Shareholder Files Suit to Halt Stryker Acquisition

By Julie A. Vetalice

Wright Medical Shareholder Files Suit to Halt Stryker Acquisition

A Wright Medical shareholder filed a suit against Wright, the company's board of directors and Stryker claiming that the Solicitation Statement submitted to shareholders regarding the proposed acquisition is false and misleading.

Specifically, the claim suggests that the statement omits disclosure of Wright's financial projections (line items used to calculate gross profit, adjusted EBITDA, operating income, unlevered free cash flow and non-operating cash flow); information about analyses performed by Guggenheim Securities, Wright's financial advisor; and information about J.P. Morgan Securities, an additional financial advisor, such as whether the latter has performed past services for any parties to the merger agreement or their affiliates.

According to the suit, omissions in the Solicitation Statement are material to the plaintiff and the those involved in the class action, as they are "deprived of their entitlement to make a fully informed decision with respect to the Proposed Transaction if such misrepresentations and omissions are not corrected prior to the expiration of the tender offer."

Court filings indicate that the plaintiff seeks to enjoin defendants and associated persons from closing the proposed transaction, rescind the proposed transaction and set it aside or award rescissory damages, direct defendants to file a Solicitation Statement that does not contain untrue statements of fact and does state all material facts required and is not misleading, etc.

Stryker made the statement announcing its definitive agreement to purchase Wright Medical in 4Q19.