New York: Law firm Brodsky & Smith is investigating potential claims against the board of directors of Baltic Trading for possible breaches of fiduciary duty and other violations of state law in connection with the sale of the company to Genco Shipping & Trading.
Under the terms of the transaction, Baltic shareholders will receive only 0.216 of a share of Genco common stock for each share of Baltic stock they own. The investigation concerns whether the board of Baltic breached their fiduciary duties to shareholders by failing to adequately shop the company before agreeing to enter into this transaction, and whether Genco is underpaying for Baltic. The transaction may both undervalue Baltic and would result in a loss for many Baltic shareholders, the law firm said in a release.
The merger via a share swap was announced on Wednesday by Greek shipping entrepreneur Peter Georgiopoulos, who is chairman of both boards of directors. The merged entity would have a combined fleet of 70 dry bulk ships with a 5.16m dwt carrying capacity.