Current shareholders of Graham Packaging Company owning their shares prior to April 13, 2011 may have a claim concerning possible breaches of fiduciary duty and other violations of law related to the Company’s entry into an agreement to be acquired by Silgan Holdings Inc. in a $4.1 billion (including debt) cash-and-stock deal.

Merger of Graham Packaging Co. & Silgan Holdings Inc.

According to the proposed merger, each outstanding share of Graham Packaging common stock will be converted into the right to receive $4.75 in cash and 0.402 shares of Silgan common stock. Based on the closing price of Silgan stock as of April 12, 2011, the stock component is valued at $14.81 per share and the overall transaction is valued at approximately $19.56 per share.

At the closing of the merger, the surviving corporation will make an aggregate cash payment of $245 million pursuant to contractual change in control provisions in the Company’s income tax receivable agreements with an affiliate of The Blackstone Group L.P. (Blackstone) and the Graham family. Blackstone already owns approximately 61% of Graham Packaging’s outstanding stock and has three members on the Company’s Board of Directors. In addition, the Graham family owns approximately 12% of the Company’s outstanding stock.

Moreover, according to Yahoo! Finance, at least one analyst has set a price target of $22.00 per share for Graham Packaging stock.

Guiliano Law Firm

The practice of Nicholas J. Guiliano, Esq., and The Guiliano Law Firm, P.C., is limited to the representation of investors in claims for fraud in connection with the sale of securities, the sale or recommendation of excessively risky or unsuitable securities, breach of fiduciary duty, and the failure to supervise. We accept representation on a contingent fee basis, meaning there is no cost to unless we make a recovery for you, and there is never any charge for a consultation or an evaluation of your claim. For more information contact us at (877) SEC-ATTY.

Comments are closed.