Infogroup Settles Investor Suit for $13m

Database company Infogroup, the former parent of research company ORC, has agreed to pay $13m to settle a dispute with an investor who claimed it was sold at 'an irresponsibly low price', under pressure from founder and deposed CEO Vin Gupta.

The money will be paid from insurance to the New Jersey Carpenters Pension Fund, which said the debt-laden Gupta had engineered a quick sale to CCMP Capital Advisors LLC in 2010 for a below par $463m.

Gupta (pictured) was removed from the Chairman's role in July 2008 following an investgation which found him guilty of 'excessive spending', including use of a private yacht and the provision of campaign funding for Bill and Hilary Clinton. The sale was mooted in the spring of 2010 and quickly opposed by investors, but was nevertheless completed by 2nd July that year. Gupta himself has also had a recent reverse in the courts in December when he was ordered to pay financial advisor Blackstone Advisory Partners $6.8m for work it carried out on his behalf when he earlier tried to buy back the firm from investors.

In the latest settlement, Gupta and other board members acknowledge no wrongdoing, agreeing the deal 'solely to eliminate the uncertainties, burden and expense of further litigation'. Court filings had suggested that faced with debts of more than $12m, Gupta pressurised directors to find a buyer for the firm so that he could sell his shares. A judge who refused to throw out the suit said in 2011 that Gupta had 'simply overwhelmed' the board with threats if they didn't agree to a sale; that he had influenced the list of potential bidders; had conducted unsupervised negotiations and leaked confidential information about the sale.

Web site: www.infogroup.com . Thanks to www.bloomberg.com for some information in the above.

All articles 2006-23 written and edited by Mel Crowther and/or Nick Thomas, 2024- by Nick Thomas, unless otherwise stated.

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