Goldman Sachs, Vista settle mistake claims over Tibco deal

[WILMINGTON] Goldman Sachs Group Inc and Vista Equity Partners agreed to settle claims they cost Tibco Software Inc investors US$100 million by miscounting the number of shares involved in a buyout of the maker of business computer programs.

Tibco shareholders "have reached an agreement-in-principle" to resolve claims that Goldman Sachs botched the share count in Vista's more than US$4 billion takeover of the software firm, according to a filing Thursday in Delaware Chancery Court. The settlement is worth about US$30 million, according to a person familiar with the matter who asked to remain anonymous because the terms haven't been made public.

Disgruntled Tibco investors alleged that Vista agreed to pay US$24 a share for the software maker, valuing the Palo Alto, California-based company at US$4.1 billion. After the deal was signed, Tibco acknowledged that it may have overstated the number of shares involved in the deal based on Goldman Sachs's count.

Wave of Suits

The Tibco case is among a wave of investor suits targeting bankers for their advice or conflicting interests in deals. A Delaware judge ordered Royal Bank of Canada to pay US$75.7 million to shareholders of Rural Metro Corp in 2014 over conflicted bankers' efforts to spur a speedy sale of the ambulance company so they could garner fees.

Michael DuVally, a spokesman for New York-based Goldman Sachs, declined to comment on the Tibco settlement. Alan Fleischmann of Laurel Strategies, a spokesman for Vista, didn't immediately return an e-mail and phone call seeking comment.

Vista, a private-equity firm focused on data, software and technology-enabled businesses, outbid other suitors for the computer firm. Because of the error over the shares, Vista wound up paying US$100 million less for Tibco than the negotiated price, the software makers investors argued.

The case is In re Tibco Software Inc Stockholders Litigation, No 10319, Delaware Chancery Court (Wilmington).

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