A while back Del Monte Foods agreed to be bought by KKR, with Barclays advising Del Monte on the merger. After the deal was announced, Barclays ran a go-shop period for Del Monte, which found no better bidders. The thing about that was that Barclays was providing KKR’s financing for the deal – and that KKR was paying Barclays more than Del Monte was. Some people thought that was kind of shitty, they sued, a Delaware court agreed, it enjoined the deal, a boutique bank (Perella Weinberg) had to run a second go-shop, there was a lot of weeping and wailing and judges saying things like:
Barclays secretly and selfishly manipulated the sale process to engineer a transaction that would permit Barclays to obtain lucrative buy-side financing fees. On multiple occasions, Barclays protected its own interests by withholding information from the Board that could have led Del Monte to retain a different bank, pursue a different alternative, or deny Barclays a buy-side role. Barclays did not disclose the behind-the-scenes efforts of its Del Monte coverage officer to put Del Monte into play. Barclays did not disclose its explicit goal, harbored from the outset, of providing buy-side financing to the acquirer.
It was a thing.
