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A shareholder of energy technology provider ChampionX Corp. has filed a lawsuit against the company and its board of directors in an effort to halt a proposed acquisition by SLB, another energy-focused technology company, alleging that ChampionX filed a deficient proxy statement.

According to the lawsuit filed by investor John Thompson in New York state court on Friday, Texas-based ChampionX develops oil and gas technology distributed to companies worldwide. SLB agreed in April to purchase ChampionX in an all-stock transaction valued at nearly $7.8 billion.

Thompson claims that ChampionX and its nine board members breached their fiduciary duties by filing an incomplete and misleading proxy statement related to the merger on May 15. The suit alleges that the statement failed to disclose crucial financial projections and analyses, as well as potential conflicts of interest faced by company insiders.

Thompson emphasizes the importance of investors receiving this critical information before June 18, the date set for stockholders to vote on the proposed transaction.

"There exists an imbalance and disparity of knowledge and economic power between the defendants and the public stockholders of ChampionX, making it inherently unfair for them to benefit their own interests to the exclusion of maximizing stockholder value," the lawsuit states.

The suit claims that the proxy statement did not disclose underlying line items for several financial metrics used in ChampionX’s forecasts, including levered and unlevered free cash flow and adjusted earnings before interest, taxes, depreciation, and amortization. It also alleges that the filing lacks complete financial analyses supporting the fairness opinion provided by ChampionX’s financial adviser, Centerview Partners, and omits information regarding discounted cash flow analysis, analyst price target analysis, and precedent premiums paid analysis.

Additionally, the suit claims the proxy omits details of any employment and retention-related discussions and negotiations between ChampionX insiders and SLB.

Thompson seeks a court order enjoining the defendants from closing the merger and requiring them to disclose all material financial information allegedly omitted from the proxy to shareholders.

"The defendants have failed to exercise ordinary care and diligence in fulfilling their fiduciary obligations toward plaintiff and the other stockholders of ChampionX," the suit states.

Counsel for Thompson and a representative of ChampionX did not immediately respond to requests for comment on Monday.

Thompson is represented by Brian D. Long of Long Law LLC and Richard A. Acocelli of Acocelli Law PLLC. Counsel information for ChampionX was not immediately available.

The case is Thompson v. ChampionX Corporation et al., index number 652791/2024, in the Supreme Court of the State of New York, County of New York