Dole Food Inc. (DOLE:US) Chief Executive Officer David Murdock was sued by an Oklahoma police pension fund over his buyout that values the fresh fruit and vegetable producer and marketer at about $1.21 billion.
The Oklahoma Police Pension and Retirement System argues Murdock’s offer of about $13.50 a share in cash for the 60 percent of Dole that he or his family doesn’t already own shortchanges shareholders, according to a complaint filed today in Delaware Chancery Court. The fund, which owns about 90,000 shares, also sued other Dole executives claiming they weren’t really independent in their assessment of the deal.
“Murdock began a low-ball bid -- a price less than the average he paid in open-market purchase late last year -- and then agreed to a higher price in ‘negotiations’ with a special committee of the board purportedly composed of ‘independent and disinterested directors,’” lawyers for the fund said in court documents.
“If the transaction is approved, the public holders will be frozen out in a grossly unfair transaction,” they said, asking for the deal to be blocked.
Scott Griswold, a spokesman for Westlake Village, California-based Dole, didn’t immediately return a call seeking comment on the lawsuit.
Murdock, who served as CEO between 1985 and 2007, returned to the role in February. He took the company private once before in 2003 and then sold 60 percent to the public in 2009. The fund said Murdock has run Dole as his own “private fiefdom.”
Other shareholders sued the company in June, also alleging the board was violating its legal duty to get the best price by accepting Murdock’s bid, then at $12 a share.
The company was founded 162 years ago and operates in more than 90 countries, producing bananas, pineapples and lettuce in Latin America and southeast Asia, according to its website.
The case is Oklahoma Police Pension and Retirement System v. Dole Food Co., CA8814, Delaware Chancery Court (Wilmington).
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