HomeFed Board, Jefferies Hit With Delaware Merger Challenge

Jefferies Financial Group Inc. and three HomeFed Corp. directors were hit with a lawsuit challenging the financial firm’s $194 million all-stock buyout of the real estate developer.

The deal closed in July, making HomeFed a subsidiary of Jefferies, which previously owned 70% of it. Each HomeFed investor got two Jefferies shares, valued at a little more than $20 apiece, per HomeFed share.

That $41-per-share price came up well short of HomeFed’s 52-week trading average of $46 or its high of $57.50, according to the partly redacted complaint made public Aug. 30.

The merger allegedly undervalued HomeFed because it was negotiated ...