Ademi LLP is investigating New Relic (NYSE: NEWR) for possible breaches of fiduciary duty and other violations of law in its transaction with Francisco Partners and TPG Capital.
In the transaction, New Relic stockholders are expected to receive only $87.00. However, approximately 20% of the shares of New Relic held by institutions and former management will be rolled over. The transaction agreement unreasonably limits competing transactions for New Relic by imposing a significant penalty if New Relic accepts a competing bid. New Relic insiders will receive substantial benefits as part of change of control arrangements.
We are investigating the conduct of New Relic’s board of directors, and whether they are fulfilling their fiduciary duties to all shareholders.