Orthovita, Inc. Directors face lawsuit by Investor in effort to stop the proposed Takeover

June 6, 2011 - PRLog -- An investor has filed a lawsuit in State Court against directors of Orthovita, Inc. seeking to block the proposed takeover of OrthoVita by Stryker Corp.

If you purchased shares of Orthovita, Inc.  and currently continue to hold those NASDAQ-VITA shares, you have certain options and you should contact the Shareholders Foundation at mail@shareholdersfoundation.com or call +1(858) 779 - 1554.

According to the complaint the plaintiff alleges the defendants breached their fiduciary duties arising out of their attempt to sell OrthoVita too cheaply via an unfair process to Stryker Corporation.

On May 16, 2011, Orthovita, Inc.  announced that it has entered into a merger agreement under which Stryker Corporation  has agreed to acquire all of the common stock of Orthovita for $3.85 per share in cash which represents a total value of approximately $316 million.

Following the buyout announcement shares of Orthovita, Inc.  jumped from $2.73 on May 13 to $3.38 on Monday, May 16.

However, the plaintiff alleges the proposed purchase price is grossly inadequate. In deed share prices for Orthovita, Inc. traded in the past significantly above the offer. VITA stock traded during 2009 as high as$6.52 and in 2010 as high as $4.60 per share. In addition, Orthovita, Inc. has performed well in the past. Orthovita’s 12months Total Revenue increased from $58.05million in 2007 to $94.66million in 2010. Its Net Loss decreased from $29.88million in 07 to a Net Loss of $5.71million in 2010.

Furthermore the plaintiff claims the proposed merger with Stryker Corp is the result of a flawed process tainted with conflicts. In fact Orthovita, Inc  said that shareholder Essex Woodlands Health Ventures Fund VII, L.P., whose representative R. Scott Barry is a member of Orthovita’s Board of Directors, as well as Messrs. Tidmore and Koblish and all of Orthovita’s other directors and executive officers, who collectively own approximately 14.5% of the fully diluted common stock of Orthovita, have already committed to tender their shares in the tender offer.

Additionally the plaintiff alleges defendants breached their fiduciary duties by agreeing in the merger agreement to certain onerous and preclusive deal protection devices, such as a restrictive no-shop, strict “standstill, a $9.8million termination provision, that will prevent superior proposals to acquire the common stock of OrthoVita Inc. from emerging and illegally retrain the Company’s ability to solicit or engage in negotiations with any third party regarding a proposal to acquire all or a significant interest in the company.

Those who purchased shares of Orthovita, Inc. (Public, NASDAQ-VITA) and currently continue to hold those NASDAQ-VITA shares, have certain options and should contact the Shareholders Foundation at mail@shareholdersfoundation.com or call +1(858) 779 - 1554.

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