Suit seeks to block Covidien, ev3 deal

[LovelyBones]

By AuntMinnie.com staff writers
June 24, 2010

A shareholder has filed a suit against ev3 of Plymouth, MN, to block the interventional device firm's acquisition by healthcare technology firm Covidien of Dublin, Ireland.

Covidien is offering $22.50 per share, which represents a premium of 19% over the value of ev3 stock at the time the deal was announced. The transaction's value would be $2.6 billion.

The complaint, filed in Delaware Chancery Court by shareholder Joanne Olson, asserts that ev3's directors breached their fiduciary duties in entering into the agreement with Covidien in order for investment firm Warburg Pincus, ev3's controlling shareholder, to exit its investment.

The suit also seeks class-action status on behalf of other stockholders and contends that a provision of the deal that would allow ev3 to issue additional shares is invalid under Delaware law.