Ademi LLP is investigating McGrath (Nasdaq: MGRC) for possible breaches of fiduciary duty and other violations of law in its transaction with WillScot Mobile Mini.
In the transaction, McGrath shareholders will receive only either $123.00 in cash or 2.8211 shares of WillScot Mobile Mini common stock, as determined pursuant to the election and allocation procedures in the merger agreement under which 60% of McGrath’s outstanding shares will be converted into the cash consideration and 40% of McGrath’s outstanding shares will be converted into the stock consideration. The transaction values McGrath at an enterprise value of $3.8 billion, including approximately $800 million of net debt. The transaction agreement unreasonably limits competing transactions for McGrath by imposing a significant penalty if McGrath accepts a competing bid. McGrath insiders will receive substantial benefits as part of change of control arrangements.
We are investigating the conduct of McGrath’s board of directors, and whether they are fulfilling their fiduciary duties to all shareholders.