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Patterson Companies, Inc. (NASDAQ:PDCO), currently trading at $31.16 and approaching its 52-week high of $31.79, disclosed today that it has amended its proxy statement in response to shareholder litigation related to its upcoming merger with Paradigm Parent, LLC. The move aims to prevent delays in the merger process, which is set to be voted on April 1, 2025. According to InvestingPro analysis, the company appears slightly undervalued based on its proprietary Fair Value model, with a market capitalization of $2.76 billion.
The Minnesota-based medical supplies wholesaler, which entered into a merger agreement with Paradigm Parent, LLC on December 10, 2024, has faced legal challenges from shareholders alleging that the proxy statement issued on February 27, 2025, lacked material information regarding the company’s sales process, financial projections, and financial advisor analysis.
Two lawsuits were filed in New York Supreme Court in March 2025, seeking to either enjoin the merger or claim damages, alleging that the proxy statement was misleading. Patterson Companies, while maintaining that the claims are without merit and that the proxy statement complies with all applicable laws, opted to supplement the proxy statement to mitigate risks associated with the litigation.
The supplemental disclosures include details about the non-disclosure agreement with Patient Square, an 18-month standstill agreement that became inoperative upon entering the merger agreement, and the fee arrangement with Guggenheim Securities, which advised on the transaction. Additional financial analyses and projections have also been provided to address concerns raised in the complaints.
Patterson’s board of directors, with the exception of CEO Donald J. Zurbay who recused himself, continue to recommend that shareholders vote in favor of the merger and related proposals.
The company has stated that no new employment agreements have been negotiated with executive officers in connection with the merger, but it is possible that such agreements or amendments may occur post-merger.
This information, based on a press release statement, is intended to ensure that shareholders have all relevant details ahead of the special meeting to make an informed decision on the proposed merger. Patterson Companies has emphasized that these supplemental disclosures should not be construed as an admission of the legal necessity or materiality of the information. For investors seeking deeper insights, InvestingPro offers comprehensive analysis through its Pro Research Report, featuring detailed financial health metrics and 10+ additional ProTips about Patterson Companies’ performance and outlook.
In other recent news, Patterson Companies is set to be acquired by Patient Square Capital in a transaction valued at approximately $4.1 billion. This all-cash deal, which values Patterson at $31.35 per share, follows the expiration of a 40-day go-shop period during which no alternative proposals were received. The acquisition is expected to close in April 2025, pending approval from shareholders and antitrust clearance in the U.S. Once completed, Patterson will operate as a privately held entity, and its shares will be delisted from the NASDAQ Global Select Market. This move is anticipated to allow Patterson to leverage Patient Square Capital’s resources and expertise in the health care sector. Shareholders will have the opportunity to vote on the merger at a forthcoming special meeting, with further details to be provided in a proxy statement filed with the SEC. This development marks a significant change for Patterson as it transitions from a public to a private company.
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