BOULDER, Colo., Sept. 24, 2008 (LAWFUEL) — The Shuman Law Firm today announced that it is investigating the proposed acquisition of Secure Computing Corp. (“Secure” or the “Company”) (Nasdaq:SCUR).
On Sept. 22, 2008, Secure announced its intention to sell the Company
to McAfee (NYSE:MFE). Under the terms of the merger agreement, Secure
shareholders would receive $5.75 in cash for every Secure share they
tender, for a total sale price of approximately $465 million in cash,
including preferred stock redemption. The proposed acquisition is
subject to customary conditions and regulatory approvals.
However, according to an analyst that follows the Company, as recently
as February, 2008, the Company announced that it had booked seven
seven-digit deals — two of which required some short-term price cuts
that affected gross margin — and 131 six-figure deals in Q4. Both were
new records, set in a time of economic uncertainty, and in spite of top
competitors such as Cisco, Websense, and EMC’s RSA business unit.
Secure expected per-share earnings to rise by 45% to 50% over each of
the next two years. Somehow, Secure then generated only $2.9 million in
operating cash flow in the following quarter, missing even the bottom
level of its guided amount. Meanwhile, as noted by The Motley Fool,
management embarked on a program which diluted outside shareholders by
amending Secure’s employee stock purchase plan.
The sales process the Company conducted was flawed given that, in
contravention of their fiduciary duties to maximize shareholder value,
the Company’s Board agreed to a “no-shop” provision and a $16 million
termination fee which effectively hinders superior offers by other
interested bidders. In addition, the proposed merger comes at a time
when Secure’s stock is trading at a yearly low. During this calendar
year, Secure’ stock has traded at more than $9.40 a share. These
provisions, taken together with other provisions in the merger
agreement, and Secure’s conduct in the months leading up to the
proposed merger may result in damage to Secure shareholders by impeding
the maximization of shareholder value.
If you currently own Secure common stock and would like a free
consultation concerning your rights and interests, please contact Kip
Shuman, Esq. or Rusty Glenn, Esq. toll-free at 866-974-8626 or email
Mr. Shuman at [email protected] or Mr. Glenn at
The Shuman Law Firm represents investors throughout the nation,
concentrating its practice in securities class actions and shareholder