(Updates with claims in complaint in second paragraph.)
Oct. 21 (Bloomberg) -- Brigham Exploration Co. was sued by shareholders contending that Statoil ASA’s $4.4 billion buyout price is too low.
The offer price is a discount to the oil and gas producer’s 52-week high trading price, according to separate suits filed by the same law firm on behalf of shareholders Robert Fioravanti and Howard Weisberg.
“The proposed transaction is the product of a flawed process that involved no known open auction,” Weisberg said yesterday in a complaint in Delaware Chancery Court.
Statoil said Oct. 17 that it would buy all of Brigham’s shares for $36.50 each, a 20 percent premium to the company’s Oct. 14 closing price. The deal is the seventh-largest takeover announced this year in the oil and gas industry.
Statoil, Norway’s biggest oil company, is using Brigham to expand into unconventional U.S. assets such as the Bakken shale area in North Dakota.
The offer price reflects an inadequate premium given Brigham’s strong growth prospects and is still below the 23 percent average premium for the industry this year, the shareholders said.
The deal also includes preclusive protection devices include a clause prohibiting Brigham from seeking a third-party bid and a $136.5 million termination fee that discourages other potential buyers, according to the complaints.
Weisberg and Fioravanti are seeking to represent all Brigham shareholders in their request to bar the transaction.
Rob Roosa, a spokesman for Brigham Exploration, didn’t immediately return a phone call seeking comment.
The cases are Weisberg v. Brigham Exploration Co., CA6957, and Fioravanti v. Brigham Exploration Co., CA6962, Delaware Chancery Court (Wilmington)
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