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The law firm of Federman & Sherwood has initiated an investigation into NetSpend Holdings, Inc. (NASDAQ: NTSP) (“NetSpend”) with respect to possible breaches of fiduciary duty by the company’s officers and directors, as well as violations of state law, in connection with the purchase offer by Total System Services, Inc. (NYSE: TSS) (“TSYS”).
On February 19, 2013, NetSpend announced that it had agreed to be acquired by TSYS, whereby TSYS would acquire all outstanding shares of NetSpend common stock in a cash offer of approximately $16.00 per NetSpend share, or approximately $1.4 billion. According to Bloomberg, this merger is being supported by JLL Partners, Inc., a 38% shareholder of NetSpend, as JLL has agreed to vote in favor of the deal, which may not necessarily be in the best interests of non-insider shareholders. Given NetSpend’s long-term, improving financial outlook, this merger limits prospective bids by other purchasers by imposing a termination penalty should NetSpend receive and accept a higher bid. If approved, this transaction is expected to close in mid-2013, subject to regulatory approval and approval by NetSpend shareholders.
Federman & Sherwood is investigating whether: (1) the information being provided to NetSpend shareholders makes all necessary disclosures with respect to the proposed sales transaction; (2) whether the proposed sale to TSYS offers adequate long-term value to NetSpend shareholders given NetSpend’s current, improving financial condition; and, (3) whether NetSpend could have received a higher per share price for its shareholders had the officers and directors aggressively sought other purchasers for the company.
If you currently own common stock in NetSpend, Inc. and purchased your shares before February 19, 2013, have information to assist in our investigation of this transaction; or, have any questions or concerns regarding this notice or preservation of your rights, please contact William B. Federman. Federman & Sherwood has extensive nationwide experience in representing investors in securities, derivative and merger-related shareholder class actions, and has been appointed as lead counsel in multiple complex cases.