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A Swedish investor has challenged OpenBet owner Endeavor Group’s $13bn take-private deal alleging a minority shareholder squeeze-out.

Handelsbanken Fonder AB’s attorneys argued the take-private violates the equal-treatment provisions of Endeavor’s corporate charter by privileging insiders, including majority shareholder Silver Lake, over public investors.

While some larger investors will be permitted to roll-over their shares into the new company, Class A stockholders are to be paid the “unfairly low” consideration of $27.50 per share, alleged Handelsbanken.

The investor highlighted analyst assessments which valued Endeavor at $30-$33 as evidence the deal violates the firm’s articles of incorporation.

The complaint said: “Simply put, the squeeze out does not respect the public Class A stockholders’ charter-enshrined right to have the right to receive, or the right to elect to receive, the same form of consideration’ as the consideration received by the preferred, insider Class A stockholders.”

That there was no vote or waiver to approve a change in the Endeavor charter’s equal-treatment provision was also criticised by the investor.

Endeavor is a US entertainment company which is the parent of OpenBet, as well as IMG Arena, which was also recently folded into the OpenBet brand.

Attorneys request court blocks deal

The attorneys, who filed the suit in Delware’s Chancery Court, requested the court to declare it can move forward as a class action with Handelsbanken as the lead plaintiff.

They are also seeking to block the deal from moving ahead, declare it a violation of Endeavor’s charter and receive compensatory damages.

The take-private was previously expected to close by the first quarter of 2025.

Silver Lake has been the majority shareholder of Endeavor, with a 68% stake, since the company’s launch on the public markets via an IPO in April 2021.

The private equity firm, alongside Endeavor chairman Patrick Whitesell and CEO Ari Emanuel, collectively own 89.5% of the business’ total shareholdings.

NEXT.io has reached out to both Endeavor and Silver Lake for comment.

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