Michael Nierenberg, the captain at the helm of Rithm Capital as chairman, CEO, and president, echoed this sentiment. He viewed the merger as a significant leap, propelling Rithm into a new phase of growth and evolution, poised to forge a global asset management juggernaut.
Legal Labyrinth: Navigating Shareholder Turbulence
The road to this merger was anything but smooth, strewn with legal challenges and shareholder dissent. The turbulence peaked when Sculptor settled a class action, a strategic move that quelled a brewing storm among shareholders mere days before the merger’s closure. This settlement, shrouded in confidentiality, resolved a legal maze initiated in September by lead shareholder plaintiff Gilles Beauchemin, who had accused Sculptor’s board of erecting barriers against potential competing bidders.
The initial merger announcement in late July had set the stage, with Rithm’s original bid standing at $639 million, offering Sculptor shareholders a lucrative $11.15 per share. This blueprint evolved dramatically in October, when Sculptor’s founding figures, led by Daniel S. Och, ignited a second class action, challenging the merger and alleging overlooked higher offers by a consortium led by Saba Capital Management.
The Final Turn: A Deal Reshaped
October 23 saw the legal dramas converge and intensify, but by October 27, a new chapter unfolded. Rithm upped its offer to an enthralling $719.8 million, a strategic increase of 13.9%. This revised offer pacified the founder group, leading to a withdrawal of their lawsuit and a vote in favor of the amended merger.
Rithm and Sculptor $720M Merger : The Advisory Ensemble
The merger was orchestrated by a league of legal eagles. Rithm was guided by Skadden Arps Slate Meagher & Flom LLP and Debevoise & Plimpton LLP, while Sculptor’s journey was navigated by Ropes & Gray LLP, with Gibson Dunn & Crutcher LLP providing tax counsel, and Latham & Watkins LLP advising the special committee.
