Wright Medical stockholder John Thompson is suing the company to halt its proposed $4 billion acquisition by Stryker, according to a proposed class action filed Jan. 15 in Delaware federal court.

Mr. Thompson alleges that Wright Medical knowingly and recklessly omitted material information about the transaction in a solicitation statement filed Dec. 13 with the U.S. Securities and Exchange Commission.

Wright Medical’s solicitation statement is “false and misleading” because it fails to include financial information that would give stockholders a basis to project the company’s future financial performance, court documents allege. Wright Medical is also accused of omitting information about financial advisers’ involvement and analyses related to the Stryker deal.

Mr. Thomas claims that Wright Medical was aware of its duty to disclose the information it allegedly omitted, and that a reasonable shareholder would consider the omitted information “important in deciding whether to tender their shares.”

Wright Medical President and CEO Robert Palmisano, board chairman David Stevens and seven directors are named as defendants in the lawsuit, along with entities involved in the proposed merger.

Demanding a trial by jury, Mr. Thomas seeks to prevent the defendants from moving forward with the acquisition. He also wants the defendants to be required to file a solicitation statement that includes all material information outlined in his lawsuit.

SOURCE: Becker’s Spine, 17th January 2020

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