MUSCATINE, Iowa (March 30) — Bandag Inc. has agreed to pay $610,000 to settle a shareholder class-action lawsuit filed after it announced Bridgestone Americas Holding Inc. will buy the company.
The tentative settlement, subject to the acquisition's completion and court approval, would require Bandag to make the payment to plaintiff's counsel for their fees and expenses, according to the company's 8-k filing.
The lawsuit filed by Plumbers and Pipefitters Local 572 Pension Fund in the Iowa District Court for Muscatine County charges Bandag failed to solicit other offers for the company. The suit alleges Bandag's directors breached their fiduciary responsibilities "by failing to solicit bids from other potential bidders" and establishing deterrents to third-party offers.
The complaint named Martin Carver, Bandag chairman, president and CEO, and six directors as defendants.
Muscatine-based Bandag said it agreed to the settlement to avoid holding up the sale and to minimize the cost of defending itself, among other reasons. Bridgestone Americas announced in December its plan to buy Bandag for $1.05 billion.