Investor Och and others sue Sculptor to halt planned deal with Rithm (updated)

Holmen AB

18/10/2023 02:35

(Adds Sculptor's response to the lawsuit in paragraph 5)
    By Svea Herbst-Bayliss
       NEW YORK, Oct 17 (Reuters) - Sculptor Capital Management
 SCU.N  founder Dan Och and other  former executives on Tuesday
sued the hedge fund, its directors and suitor Rithm Capital Corp
 RITM.N , seeking to allow shareholders to hear details of a
higher rival offer. 
    The suit, filed in Delaware Court of Chancery, seeks to stop
Rithm's planned $676 million acquisition until a rival bidder,
led by fund manager Boaz Weinstein, is freed from its standstill
obligation and can present its offer fully to shareholders and
the hedge fund's clients. 
    Sculptor last week said it was accepting Rithm's sweetened
offer of $12 a share. It is below the $13 a share offer that
Weinstein and a group of billionaire fund manager backers,
including Bill Ackman, Marc Lasry and Jeff Yass have said they
are ready to pay.
    The lawsuit says that much of the back and forth on bids
revolves around the future of Sculptor chief investment officer
Jimmy Levin, who was groomed by Och years ago as his eventual
successor before Och changed his mind.
    Sculptor Capital Management's Special Committee of its Board
on Tuesday called the lawsuit "baseless." "Dan Och’s complaint
is replete with materially misleading statements," it said.
    Rithm proposes to keep Levin in his job while Weinstein has
said he would not do so.
    "The proposed merger reflects just the latest step in a long
line of actions by which the directors have demonstrated that
they are beholden to Mr. Levin and place his interests over the
stockholders' interests," Och's lawsuit said.
    The case is Och v. Engel, 2023-1043, Delaware Chancery Court
(Wilmington).

 (Reporting by Svea Herbst-Bayliss; Additional reporting by
Shubhendu Deshmukh; Editing by Rod Nickel; Leslie Adler and
Muralikumar Anantharaman)
 ((svea.herbst@thomsonreuters.com; +617 233 2138; Reuters
Messaging: svea.herbst.thomsonreuters.com@reuters.net))