Kuebler v. Vectren Corp., No. 19-2973 (7th Cir. 2021)Annotate this Case
Following the 2018 merger between Vectren, an Indiana public utility and energy company, and CenterPoint, a public utility holding company, CenterPoint acquired all Vectren stock for $72.00 per share in cash. Several Vectren shareholders had filed suit alleging violations of the Securities Exchange Act of 1934, 15 U.S.C. 78a. The district court declined to enjoin the shareholder vote on the merger. The shareholders then filed an amended complaint alleging that Vectren’s Proxy Statement was misleading under Section 14(a) of the Act, arguing that the Proxy Statement should have included financial metrics used by Vectren’s financial advisor in its analysis leading to its opinion that the merger terms were fair to Vectren shareholders. The first omitted metric, Unlevered Cash Flow Projections, forecast the gross after‐tax annual cash flow for Vectren, 2018-2027. The second omitted metric, Business Segment Projections, showed separate financial projections for each of Vectren’s three main business lines.
The Seventh Circuit affirmed the dismissal of the suit. The shareholders failed to allege adequately both materiality of the omissions and any resulting economic loss. The court noted that the plaintiffs did not allege the existence of a viable superior offer to support their allegations of economic loss.