Stockholder Sues Capital Bank, First Horizon Over Proposed Merger

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Capital Bank Financial Corp., its board of directors, First Horizon National Corporation, and Firestone Sub, Inc. are facing claims that they failed to disclose all the necessary information regarding a proposed merger between Capital Bank and First Horizon. According to the lawsuit, the defendants omitted certain details concerning Capital Bank’s financial projections and figures used in the valuation analyses performed by its financial advisor. From the complaint:

“[T]he disclosure of projected financial information is material because it provides stockholders with a basis to project the future financial performance of a company, and allows stockholders to better understand the financial analyses performed by the company's financial advisor in support of its fairness opinion.”

The plaintiff further argues that the defendants failed to release information concerning potential conflicts of interest of its board of directors, including communications regarding future employment with the new combined company. The complaint claims shareholders require these details in their determinations of the deal’s fairness.