BDO USA Sued Over $1.3 Billion Employee Stock Plan Transaction

A participant in BDO USA’s employee stock ownership plan filed a proposed class action saying workers were wrongly overcharged to become partial owners in the accounting and advisory firm.

The lawsuit centers on an August 2023 transaction in which a newly-established ESOP purchased 42% of BDO’s common stock from executives and other principals for about $1.3 billion. This transaction, which was financed by a private credit deal with Apollo Global Management affiliates, was done at an inflated purchase price that reflected a flawed valuation of the company based on inflated earnings and unreasonable projections, according to the complaint.

Plaintiff ...