Ademi LLP is investigating Houston Wire (NASDAQ: HWCC) for possible breaches of fiduciary duty and other violations of law in its transaction with Omni Cable.
Ademi LLP alleges Houston Wire’s financial outlook is excellent and yet Houston Wire shareholders will receive only $5.30 per share in an all-cash transaction valued at $91 million. The merger agreement unreasonably limits competing bids for Houston Wire by prohibiting solicitation of further bids, and imposing a termination penalty if Houston Wire accepts a superior bid. Houston Wire insiders will receive millions of dollars as part of change of control arrangements. We are investigating the conduct of Houston Wire’s board of directors, and whether they are (i) fulfilling their fiduciary duties to all shareholders, and (ii) obtaining a fair and reasonable price for Houston Wire.