The Wall Street Journal
DELAWARE — A Delaware judge ruled against RBC Capital Markets LLC in a suit challenging the bank’s advice in the 2011 buyout of an ambulance operator, a decision likely to rattle Wall Street and empower shareholders suing over deals.
The judge ruled that RBC was so eager for fees from the sale of Rural/Metro Corp. that it steered the company into a quick sale to private-equity firm Warburg Pincus LLC at a price that wasn’t fair to Rural/Metro shareholders.
J. Travis Laster, a vice chancellor in Delaware’s business court, said Rural/Metro was worth more than Warburg was willing to pay, but to get the deal done RBC revised its valuation downward to make a lower offer appear worth taking.
Read full story: RBC Liable Over 2011 Buyout of Ambulance Operator Rural/Metro