WILMINGTON, Del.--(BUSINESS WIRE)--Andrews & Springer LLC, a boutique securities class action law firm focused on representing shareholders nationwide, is investigating potential breach of fiduciary duty claims against the Board of Directors of Covance Inc. (NYSE: CVD) (“Covance” or the “Company”) relating to the sale of the Company to Laboratory Corporation of America Holdings (“LabCorp”). On November 3, 2014, the two companies announced the signing of a definitive merger agreement pursuant to which LabCorp will acquire Covance in a merger in a deal worth $6.1 billion. As a result of the merger, Covance shareholders are only anticipated to receive $75.76 in cash and 0.2686 shares of LabCorp in exchange for each share of Covance (total consideration approximately $105.12 per share).
Andrews & Springer’s investigation focuses on the insufficient consideration that Covance shareholders are expected to receive. Following the merger, Covance shareholders are expected to be substantially diluted, owning only 15.5% of the combined company. Additionally, the 0.2686 fixed exchange ratio restricts the value that Covance shareholders are expected to receive by exposing Covance shareholders to the volatility of LabCorp’s share price. Because the exchange ratio is fixed and the Company has not indicated that there has been a price collar established, Covance stockholders likely have no protection against a future drop in the price of LabCorp shares, and could experience an even smaller, or negative, premium as a result of the proposed merger.
If you own shares of Covance and want to receive additional information and protect your investments free of charge, please visit us at http://www.andrewsspringer.com/cases-investigations/CVD or contact Craig J. Springer, Esq. at email@example.com, or call toll free at 1-800-423-6013. You may also follow us on LinkedIn – www.linkedin.com/company/andrews-&-springer-llc, Twitter – www.twitter.com/AndrewsSpringer or Facebook - www.facebook.com/AndrewsSpringer for future updates.
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