SendGrid Sued By Shareholders Over Twilio Deal

Marketing service provider SendGrid is facing another shareholder suit over its pending $2 billion acquisition by Twilio. 

The class action complaint, alleging violations of the Securities Exchange Act of 1934, was filed this week by the law firm of Rigrodsky & Long, P.A. in the U.S. District Court for the District of Delaware, according to the legal firm. .

SendGrid is facing at least one other class-action suit in Colorado. 

The new case charges that the defendants made “materially incomplete disclosures” about SendGrid’s financial projections, in a registration state filed with the Securities and Exchange Commission. The defendants also include Twilio and SendGrid’s board of directors.

Such lawsuits often accompany transactions of this sort.

SendGrid had not responded to a query about the case at deadline.

Twilio announced in October that it would acquire SendGrid in an all-stock transaction.

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The purchase, which is expected to close in the first half of 2019, subject to shareholder approval, was valued at roughly $36.92 per share based on closing prices at the time of the announcement.

SendGrid shareholders are to receive 0.485 shares of Twilio common stock for each share of SendGrid stock they own, the plaintiffs state.

Twilio expects that adding SendGrid’s email API platform to its cloud communications platform will provide value to the clients of both firms. The two firms have over 100,000 customers between them. 

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