USAmeriBancorp, Valley National Bank Hit with Securities Class Action Over Merger

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The proposed acquisition of USAmeriBancorp, Inc. by Valley National Bancorp announced on July 26, 2017 has landed the banks, as well as the former’s board of directors, in the crosshairs of a proposed class action lawsuit. Filed in Florida, the lawsuit notes that if stockholders for both banks approve the deal, they stand to receive 6.1 shares of Valley National common stock for each share of USAmeriBancorp stock they own (subject to certain market conditions). All told, the proposed merger would see USAmeriBancorp stockholders own roughly 20.3 percent of Valley National’s outstanding common stock.

According to the lawsuit, however, the defendants on September 29, 2017 filed a materially incomplete Form S-4 Registration Statement with the United States Securities and Exchange Commission (SEC). The registration statement is allegedly missing such information as both banks’ financial projections and the valuation analyses performed by USAmeriBancorp’s financial advisors.

Moreover, the complaint argues that the defendants omitted from SEC documentation, among other alleged non-disclosures:

• The projections USAmeriBancorp’s financial advisors used in its analyses supporting the opinion that the merger is fair to stockholders;
• Material information regarding the background of the merger, namely the process the director defendants used in supporting the deal;
• Whether any other parties may have an interest in acquiring USAmeriBancorp; and
• Details of negotiations over the terms of the merger.

The complaint can be read below.