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CommerceHub satisfies shareholder suing to block sale of company

CommerceHub satisfies shareholder suing to block sale of company

Company discloses additional information; vote on sale to go forward May 18
CommerceHub satisfies shareholder suing to block sale of company
CommerceHub in the Zen Building in Albany.
Photographer: Peter R. Barber

ALBANY — CommerceHub has revised its financial filings and apparently satisfied a shareholder who had sued to stop the sale of the firm.

Brian Gordon on April 27 filed a lawsuit to delay or block the acquisition of the Albany-based e-commerce firm, saying CommerceHub had issued a misleading and incomplete proxy statement to shareholders, whose vote of approval is required.

On Monday, CommerceHub filed a supplemental disclosure. Also Monday, Gordon’s attorney submitted paperwork withdrawing his request to block the May 18 shareholder vote and asked to cancel a scheduled court hearing for May 17.

Gordon’s motion said CommerceHub’s filing followed arm’s length negotiations; it said the supplemental disclosure rendered his claims moot. 

On March 5, the CommerceHub Board of Directors agreed to sell the company to private-equity firms GTCR and Sycamore Partners for $1.1 billion. The deal valued the company’s stock at $22.75 per share; at the close of trading the day before the deal was announced, it was priced at $18.27.

Gordon’s lawsuit, which named the company, its board of directors and co-founder Franck Poore as defendants, sought class action status for himself and other shareholders.

The Manhattan resident alleged the proxy failed to disclose information necessary for shareholders to properly assess the fairness of the proposal, particularly financial projections for the company, the sale process and prior relationships between GTCR and CommerceHub’s financial adviser, Evercore Group.

The supplemental disclosure spells out Evercore’s actions in detail.

CommerceHub, in its filing Monday, said it considered the lawsuit without merit and said no further disclosures were needed. It also said that to avoid the uncertainty and expense of litigation, it was making the additional disclosure, stipulating that it was not admitting that the action was necessary or that it had committed any wrongdoing.

CommerceHub is headquartered in Albany and most of its 320 employees work out of the ZEN building on the SUNY Polytechnic’s Albany campus. Its leadership team and workforce are expected to remain in place after the acquisition.

CommerceHub was founded in Albany in 1997 and is a hub for online commerce, connecting retail buyers, sellers and suppliers electronically. In 2017, it handled $16 billion worth of transactions for 50 client retailers ranging from Wal-Mart to Walgreens to Whirlpool. It arranges sales and shipment of goods through its clients’ websites without the client retailer ever having to touch the product. Instead, one of CommerceHub’s 11,000 suppliers will fulfill the order.

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