A derivative suit was filed by investors of Onyx Pharmaceuticals alleging that the company undervalued its position during its acquisition by Amgen Inc. The suit claims the said transaction was 'infected' by numerous instances of conflicts of interest.
According to the documents filed in Redwood City, CA, the said transaction was 'infected by numerous conflicts of interest which hamstring the ability' of Onyx directors from 'fulfilling their fiduciary obligations to the company's shareholders.'
Amgen is currently the world's biggest biotechnology company in terms of sales volume. According to a statement made last August 25, the said acquisition would be financed using a USD8.1 billion bank loan and cash on hand with the company.
The complaint further stated that Onyx directors had served on the board of a 'de facto Amgen subsidiary' or they may have relied on Amgen for the funding of their company. The whole transaction was deemed tainted because of the relationships created between Onyx CEO N. Anthony Coles and the other memebrs of the Amgen board.
The complaint further stated that the prohibition on third parties submitting superior offers was contained in the merger agreement, which is clearly detrimental to the shareholders of Onyx.
Join the Conversation