Vending

Stockholder sues to stop Performance Food Group acquisition of Core-Mark

A lawsuit in California seeks to halt Core-Mark's proposed acquisition by Performance Food Group, the parent company of Vistar, the nation's largest vending product wholesale distributor.

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August 13, 2021

Core-Mark Holding Co. Inc. and members of its board were hit with a lawsuit Wednesday in California Central District Court seeking to halt Core-Mark's proposed acquisition by Performance Food Group, the parent company of Vistar, the nation's largest vending product wholesale distributor.

The suit, brought by WeissLaw, a Core-Mark stockholder, claims that on July 14, Core-Mark filed a definitive proxy statement with the SEC recommending stockholders vote for the transaction which omits or misrepresents information concerning the company's financial projections and data underlying the valuation analysis that support the fairness opinion provided by Barclays Capital Inc., the company's financial advisor.

The suit, which is available on the law.com website, claims Core-Mark stockholders will be "irreparably harmed because the proxy statement's misrepresentations and omission prevent them from making a sufficiently informed voting decision on the proposed transaction."

The suit claims Core-Mark insiders will be the primary beneficiaries of the transaction, and not the public stockholders. The executive officers are conflicted, according to the suit, because they will have unique benefits not available to the public stockholders.

The suit also says the proxy statement fails to include all line items underlying adjusted EBITDA and earnings per share and quantification of the assumptions underlying the forecasts.

The plaintiff demands injunctive relief on behalf of Core-Mark and against the defendants and asks the court to enjoin defendants from proceeding with the transaction and demands a jury trial on its claims.

The proposed transaction, which values Core-Mark at approximately $2.5 billion, would create a convenience business within Vistar that would include the Core-Mark and Eby-Brown businesses.

Core-Mark had not responded to a Vending Times' request for comment as of press time.