Sculptor Capital Corp Investors Allege They’ll Be Underpaid In Acquisition By Rithm Capital

Silver Law Group, a nationally-recognized class action law firm representing shareholders, is investigating Sculptor Capital Management (SCU) regarding its sale to Rithm Capital Corp and potential breach of fiduciary duty claims against the board of directors of Sculptor.

If you own shares of Sculptor Capital Management (SCU), Silver Law Group would like to hear from you. Contact us today for a consultation at 800-975-4345.

Sculptor Capital Corp (SCU) Agrees To Acquisition By Rithm Capital

In July, 2023 Sculptor Capital Management and Rithm Capital Corp announced that they had reached an agreement in principle for Rithm to acquire Sculptor Capital. The merger is expected to pay Sculptor Capital $11.15 cash for each Class A share of the company.

It has been alleged that the merger may involve conflicts of interest with Sculptor insiders because certain of them are rolling over some of their equity into the merged company. Sculptor shareholders will receive cash for their shares and will receive no equity in, or potential to benefit from, the merged entity.

Moreover, the $11.15/share Sculptor shareholders would receive is significantly lower than the $14/share price target set by Credit Suisse in May, 2023, and over 2% lower than SCU’s 52 week high of $11.40.

An investor in Sculptor Capital has alleged that the board of directors and its special committee have protected their compensation at the expense of shareholders’. They state that Rithm had agreed to offer $12/share, then reduced its offer almost one dollar because “it would need to spend more money than anticipated in the form of a long-term incentive plan and retention plan for the Company’s senior leadership.”

The investor alleges that the compensation of Sculptor CEO and Chief Investment Officer Jimmy Levin is “indefensible” and that he would receive a “substantial severance package” if he and Rithm cannot renegotiate his 2024 contract for any reason. They also allege that Levin’s compensation structure ensures that he will be motivated to maximize his own pay, rather than returns for shareholders.

Do You Own Shares Of Sculptor Capital Management (SCU)?

Silver Law Group represents investors nationwide and internationally in cases of securities and investment fraud through class action lawsuits against issuers in state and federal court, and in arbitration claims in cases of stockbroker misconduct.

Scott Silver, managing partner of Silver Law Group, is the chairman of the Securities and Financial Fraud Group of the American Association of Justice. Contact us for a no-cost consultation at ssilver@silverlaw.com or call (800) 975-4345.