The lawsuit continues against Joel Weinshanker, president and CEO of National Entertainment Collectibles Association Inc. in Hillside, preventing him from purchasing Hastings Entertainment for $21.4 million.
In a lawsuit filed by Rigrodsky & Long P.A. on March 28 in U.S. District Court, Andreas Oberegger of London and David A. Capps of Tennessee allege that Weinshanker would only offer stockholders $3.00 per share, less than half of the $7.57 per share book value the company held this past October, and that Hastings did not seek out more competitive deals with potential buyers before making a deal with Weinshanker.
The lawsuit also states that shareholders could get twice as much if Hastings liquidated its assets and sent the proceeds to shareholders.
Hastings’ Chief Financial Officer Dan Crow said in a recent news release that the deal would convert Hastings into a private business and cash out shareholders, while Crow would be paid $750,000 to exit the company and CEO John Marmaduke would retire on a $1.5 million cash payment.
The company enjoyed record high revenue of $548 million in 2006 before plummeting to $436 million in 2013, according to an Amarillo Globe-News analysis, though that number has been increasing since Hastings recently revamped its stores to more appropriately enter the digital age.
National Entertainment Collectibles Association Inc. is an 18-year-old manufacturer of multimedia collectibles and one of the largest providers of wholesale licensed movie merchandise in the country.
Hastings Entertainment Inc., founded in 1968 in Buffalo, N.Y., currently operates 146 nationwide superstores that both sell and rent new and used books, movies, video games, CDs and more.
ALSO ON NJBIZ: