updated 04:18 pm EDT, Fri September 6, 2013
Shareholder claims price is excessive
Verizon has been hit with a shareholder lawsuit over the company's planned buyout of Vodafone's 45-percent stake. Citing the drop in Verizon's share price following the announcement of the $130 billion deal, investor Natalie Gordon argues that the carrier agreed to pay too much for Vodafone's minority interest.
"It is evident that Verizon has overpaid ... Wall Street analysts concur," Gordon said, according to a Reuters report. She references a decision by Moody's Investment Service to downgrade Verizon's credit rating as further evidence of overpayment.
The lawsuit names Verizon CEO Lowell McAdam and the company's directors as co-defendants, claiming the deal represents a failure to uphold their fiduciary duties.
Gordon is seeking class-action status and calls for the company to rescind the agreement or drop the buyout price to a reasonable payout.
"We believe this lawsuit is entirely without merit, and Verizon intends to defend itself vigorously," said Verizon general counsel Randal Milch.