Monogram Biosciences, Inc. Investor Class action Lawsuit: UPDATE
LabCorp and Monogram announced that LabCorp and Monogram have agreed in principle with the shareholder plaintiffs to settle purported class action lawsuits filed in the Court of Chancery of the State of Delaware and in the Superior Court of the State of California, San Mateo County relating to the pending tender offer and subsequent merger. Under the terms of the proposed settlements, the claims of the named plaintiffs and the proposed class of public shareholders relating to the tender offer and the related agreement and plan of merger entered into by LabCorp and Monogram on June 22, and the transactions contemplated thereby will be dismissed. Finalization of the proposed settlements remains subject to several conditions, including court approval and completion of the tender offer and the other transactions contemplated by the agreement and plan of merger in accordance with its terms. In connection with the proposed settlements, Monogram has agreed to provide additional disclosures in Monogram's solicitation/recommendation statement on Schedule 14D-9. The settlements will not affect the price of $4.55 per share paid in the offer or the consideration to be paid in the subsequent proposed merger.

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An angry investor has filed a proposed securities class action lawsuit in the Superior Court of California on behalf of current investors Monogram Biosciences, Inc. (Public, NASDAQ:MGRM), who purchased the shares before June 23, 2009, alleging breaches of fiduciary duty and other violations of state law by the board of directors of Monogram Biosciences Inc.

According to complaint challenging the proposed acquisition of Monogram Biosciences, Inc. the plaintiff alleges breaches of fiduciary duty and other violations of state law by the board of directors of Monogram Biosciences, Inc. (NASDAQ:MGRM)) arising out of their attempt to sell Monogram Biosciences, Inc. to Laboratory Corporation and on the potential unfairness of the merger price and of the process by which the Monogram Board of Directors approved the agreement. On June 23, 2009 Laboratory Corporation of America (NYSE: LH) and Monogram Biosciences, Inc. (NASDAQ: MGRM) announced that they have entered into a definitive agreement and plan of merger under which Laboratory Corporation will acquire all of the outstanding shares of Monogram in a cash tender offer for $4.55 per share for an implied total equity value of approximately $106.7 million, or a total enterprise value of approximately $155 million at March 31, 2009, including net indebtedness.

Looking at recent numbers, Laboratory Corporation's proposed purchase price represents a premium over Monogram's closing price of $1.68 on June 22, the day before the acquisition was announced. According to a previous investigation the acquisition price appears unfair, given that Monogram shares traded over $5.00 per share as recently as September 2008 and at $7.20 per share in August 2008 (on a split-adjusted basis) and at least one analyst set a $6.00 price target for Monogram shares. Another investigation called the deal “suspicious because it appears from a review of the Company's financial statements that the inherent value of the Company's stock is greater than $4.55, because the stock traded recently at over $5.00 per share, and also because at least one analyst has recently valued the stock at $6.00 per share”.

Monogram Biosciences, Inc. located in South San Francisco, CA, is a life sciences company engaged in the development of molecular diagnostic products that guide and target the appropriate treatments. Monogram Biosciences reported $43.23million in Total Revenue in 2007 and $62.19million in 2008. Shares of Monogram Biosciences (NASDAQ: MGRM) closed at $4.55 per share on Friday, June 26, 2009, down from a 52weekHigh of $7.44 per share.