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MetroPCS sued over merger terms in T-Mobile deal
MetroPCS shareholders want an amended proxy statement before investors vote on the proposed merger with T-Mobile.
Bloomberg News and The Associated Press
A group of MetroPCS investors asked a federal court to delay a planned April 12 shareholder vote on the wireless carrier’s proposed $39 billion merger with Bellevue-based T-Mobile USA.
Plaintiffs including the Merger Fund and GS Master Trust, which said they own more than 12.5 million MetroPCS shares, allege that the company issued a false and misleading proxy statement in October seeking shareholder support for the deal. They want next month’s meeting postponed until the proxy statement can be amended.
T-Mobile will “gain enormous benefits and strategic advantage from the proposed transaction,” according to the complaint filed Thursday.
Defendants named in the complaint include Chief Executive Officer Roger Linquist and directors Arthur Patterson and W. Michael Barnes. The suit includes claims of breach of fiduciary duty and violation of securities law.
“These defendants acting recklessly, in bad faith and in conscious or reckless disregard of their duties, caused MetroPCS to issue a materially false and misleading March 2013 statement,” the shareholders alleged.
MetroPCS intends to defend itself against the lawsuit, the company said.
Advisory firm Institutional Shareholder Services (ISS) has urged shareholders to block the merger, citing unfavorable terms and the potential for MetroPCS to thrive as an independent company.
Investors bet Thursday that T-Mobile will have to sweeten its proposal, pushing MetroPCS shares up 3.5 percent, to $10.90.
In a rebuttal to ISS, MetroPCS said the deal offers “compelling benefits,” and that another shareholder advisory firm, Egan Jones, supports it.
“We strongly believe that ISS’ report contains material flaws and reaches the wrong conclusion,” MetroPCS said in a statement.