Investor Law Firms Eye BJ's Bid

WESTBOROUGH, Mass. Several shareholder-rights law firms last week said they were examining the private-equity takeover of BJ's Wholesale Club to see if the company acted in the best interest of investors by accepting a $2.8 billion offer. Our investigation concerns possible breaches of fiduciary duty and other violations of law related to the approval of the transaction by company's board of directors;

WESTBOROUGH, Mass. — Several shareholder-rights law firms last week said they were examining the private-equity takeover of BJ's Wholesale Club [4] to see if the company acted in the best interest of investors by accepting a $2.8 billion offer.

“Our investigation concerns possible breaches of fiduciary duty and other violations of law related to the approval of the transaction by company's board of directors; in particular, whether the company undertook a fair process to obtain fair consideration for all shareholders of BJ's,” said Wayne, Pa.-based law firm Ryan and Miniskas in a prepared statement.

Several other law firms issued similar statements.

A spokesperson for BJ's could not be reached.

BJ's last week said it had agreed to a takeover offer by Leonard Green & Partners and CVC Capital Partners for $51.25 per share, a 6.6% premium over the previous day's trading price. Some reports indicated that the company could have been worth up to $60 per share. BJ's said its board has unanimously approved the transaction.

The retailer had formally put itself up for sale in February. Last year Leonard Green & Partners, which also owns a stake in Whole Foods Market, said it had acquired a 9.5% interest in BJ's and was in talks to buy the company.

“BJ's will benefit from the continued execution of our business plan and the significant retail expertise of our new partners at LGP and CVC, as well as from continued investments in our clubs, our people and technology, and the future of our business,” said Laura Sen, president and chief executive officer, BJ's.

The merger is subject to the approval of BJ's shareholders. The transaction is expected to close during the fourth quarter of 2011.

BJ's, with 190 stores along the Eastern U.S., is the No. 3 membership warehouse club behind Costco [5] and Wal-Mart's [6] Sam's Club.