Following the announcement by optionsXpress Holdings, Inc. that its board of directors agreed to a takeover by Charles Schwab Corp. an investigation on behalf of investors of optionsXpress Holdings, Inc. (Public, NASDAQ:OXPS) concerning the potential unfairness of the takeover and possible breaches of fiduciary duty was announced.
The investigation by a law firm concerns whether certain directors and officers at optionsXpress Holdings, Inc. (NASDAQ:OXPS) or others breached or will breach their fiduciary duties in connection with proposed buyout.
On Monday, March 21, 2011, OptionsXpress Holdings, Inc., (NASDAQ-GS:OXPS) and the Charles Schwab Corporation (NYSE:SCHW) announced they have signed an agreement under which Schwab will acquire optionsXpress. Under the terms of the proposed agreement, optionsXpress stockholders will receive 1.02 shares of Charles Schwab Corporation (NYSE:SCHW) stock for each share of ptionsXpress Holdings, Inc., (NASDAQ-GS:OXPS) stock. Based on Charles Schwabs closing stock price as of March 18, 2011, the transaction values each OptionsXpress Holdings, Inc. (NASDAQ:OXPS) share at $17.91, resulting in a total transaction value of approximately $1.0 billion.
Indeed, shares of OptionsXpress Holdings, Inc. (Public, NASDAQ:OXPS) increased in response to the takeover news from $15.16 on Friday to $17.66 on Monday.
However, OXPS shares traded as recently as December 2010 as high as $21 per share and in April 2010 as high as $18.07, thus giving some OXPS stockholders with no premium but asking them to hand over their shares at a discount. OXPS shares have traded also during March, August and November 2010 near the offer thus leaving only a meager premium. During 2009 OXPS shares traded also multiple times above the current offer and during 2008 and 2007 OXPS shares traded several times significantly above the offer.
Additionally certain stockholders representing 22.9% of optionsXpress stock have already signed a voting agreement committing to vote these shares in favor of the transaction. In addition optionsXpress Holdings performed consistently over the past years. optionsXpress Holdings reported consistent 12months Total Revenue over the past four years ranging from $231.44million to $247.03million. Its Net Income ranged over the past four years from $51.90million to $97.72million.
Therefore the investigation monitors and concerns whether optionsXpress Holdings Board of Directors undertook an adequate and fair sales process to obtain the maximized consideration for all shareholders of optionsXpress Holdings, Inc. (NASDAQ:OXPS) and breached their fiduciary duties to optionsXpress Holdings (OXPS) investors by failing to adequately shop the Company before entering into the transaction. The investigation concerns also whether the Charles Schwab Corp. would underpay for NASDAQ:OXPS shares, thus unlawfully harming NASDAQ:OXPS investors. A potential class action lawsuit would seek to maximize the amount of money and information for OXPS stockholders would receive in a buyout, so the law firm.