Louisiana Pension Sues NYSE, Says Proposed Deal 'Won't Offer Fair Price'

(February 28, 2011) — The Louisiana Municipal Police Employees’ Retirement System has sued NYSE Euronext, the parent company of the New York Stock Exchange, saying that the proposed deal won’t offer a fair price to NYSE’s public shareholders.

The suit stems from an effort to thwart a planned $9.53 billion sale to Deutsche Boerse AG, which would create the largest owner of equities and derivatives markets, Bloomberg reported. “In light of defendants’ breach of their fiduciary duties in agreeing to an unreasonably low price for the sale of the NYSE and agreeing to unreasonable and draconian deal protections,” shareholders are “entitled to enjoin the proposed transaction or, alternatively, to recover damages in the event the proposed transaction is consummated,” according to the complaint obtained by the news agency.

The case, which also includes Deutsche Boerse and the NYSE’s board as defendants, is Louisiana Municipal Police Employees’ Retirement System v. NYSE Euronext, New York State Supreme Court.

Separately, the Louisiana Municipal Police Employees´ Retirement System, along with other investors, has aggressively pushed for reforms in the way BP operates. The fund claimed that officers and directors of BP ignored “red flags” that could have prevented the massive oil spill in the Gulf of Mexico. The Louisiana fund said it is seeking reforms in BP management. Initially, the Louisiana pension filed the derivative lawsuit against BP in May, within weeks of the explosion, and the fund was soon joined by similar investor claims.