Today, USA Truck announced it has filed a beach of contract lawsuit against Knight Transportation for, “improperly using USA Truck’s confidential information to begin a creeping hostile acquisition of USA Truck at a price that the Board has unanimously concluded does not reflect the Company’s full intrinsic value.”
The lawsuit stems form Knight Transportation’s attempt to purchase USA Truck for $9.00 per share last month, an offer USA Truck refused.
“Knight already owns 829,946 shares of USA Truck common stock, or about 8% of USA Truck’s outstanding shares,” Trucking Info reported.
The lawsuit was filed in the Circuit Court of Crawford County, in Van Buren, Arkansas. It alleges “Knight Transportation’s actions, including its purchasing shares of USA Truck stock using USA Truck’s confidential information and its disclosure of the prior discussions with USA Truck, are blatant violations of the Confidentiality Agreement between the parties and have disadvantaged the Company’s other stockholders.”
The lawsuit goes on to state that Knight Transportation’s recent statements to the public made it clear that Knight Transportation plans to “further violate the Confidentiality Agreement by using such confidential information to pursue a hostile takeover of USATruck without negotiating with USA Truck’s Board of Directors.”
USA Truck says the company filed the lawsuit to provide that the company can consider any proposed sale without the threat imposed by Knight Transportation’s share acquisition.
USA Truck issued the following statement regarding the lawsuit:
USA Truck’s Board of Directors is very disappointed that Knight is doing exactly what it promised not to do: use confidential information that it was provided in the context of friendly and private discussions regarding a negotiated transaction between the companies to initiate a creeping hostile takeover of USA Truck at a price that does not reflect the full intrinsic value of USA Truck. As stated in the Company’s release dated September 26, the Company has previously offered to meet with Knight and remains open to all strategic options that reflect the full intrinsic value of USA Truck, including further discussions with Knight.