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AmTrust Buyout Suit Gets Green Light Against Karfunkel Family

Feb. 26, 2020, 8:14 PM

AmTrust Financial Services Inc.’s founding family and three of its directors must face claims that its 2018 take-private buyout was “grossly unfair” to non-insiders squeezed out by the deal, a Delaware judge ruled.

The Chancery Court lawsuit targets three members of the Karfunkel-Zyskind family, which owned 55% of the insurer before buying the rest, and AmTrust’s four other directors, who sat on the special committee that approved the transaction.

It accuses them of doctoring financials until about a year before the buyout, then taking the company private at a lowball price after news of the scheme tanked its market value. ...