Key Takeaways
- • A proposed class of Skechers shareholders, led by SM Merger/Arbitrage L.P., filed a class action in the Central District of California alleging a multibillion-dollar fraud tied to the company's September 2025 take-private by 3G Capital.
- • The plaintiff alleges Skechers executives manipulated financial projections and used threatened U.S.-China trade war tariffs to depress the share price ahead of a $63-per-share buyout, which the complaint says was artificially low.
- • The complaint says 3G Capital bought Skechers for $9.4 billion and that members of the Greenberg family received over $1 billion in cash proceeds while rolling over more than 18 million shares into the new private entity.
- • Financial adviser Greenhill & Co. is accused of using Skechers' lowered projections in its fairness evaluation of the deal, according to the plaintiff.
- • Skechers declined to comment on the litigation; the allegations remain unproven claims in a complaint.
Summary
A proposed class of Skechers shareholders sued the footwear brand, private equity firm 3G Capital and financial adviser Greenhill & Co., alleging that the defendants collaborated to artificially depress the company's stock price ahead of its take-private. The plaintiff, SM Merger/Arbitrage L.P., a private investment fund, filed the proposed class action on a Wednesday in the Central District of California, according to Courthouse News. The suit stems from Skechers' September 2025 sale to 3G Capital, which took the publicly traded company private for $9.4 billion.
The complaint alleges that Skechers' officers disseminated false and misleading statements, omitted material facts and manipulated financial projections to deflate the share price and facilitate a more lucrative deal. The plaintiff says the officers' core objective was to buy out unaffiliated minority shareholders at an artificially depressed price of $63 per share of Class A common stock. Before announcing the deal, the company allegedly invoked the threat of a trade war between the U.S. and China to further depress the price, although it internally viewed the potential tariff impacts as minimal or even beneficial, the plaintiff contends.
The complaint focuses on the Greenberg family, Skechers' founders Robert and Michael Greenberg, who allegedly maintained their stake and control while shareholders were bought out at lower prices. The plaintiff contrasts the $63 cash-out with the alternate consideration option available to legacy shareholders, under which the Greenbergs reportedly received $57 per share in cash plus one equity unit per share in the post-closing private entity, with an expected per-unit capital contribution of $29, a nominal total of $86 per share. The plaintiff says this allowed the Greenbergs to receive over $1 billion in cash from 3G Capital while rolling over more than 18 million shares into the new Skechers Limited Liability Company. The complaint alleges 3G Capital was willing to provide this windfall in exchange for take-private terms that gave public shareholders unfairly low consideration.
Greenhill & Co. is alleged to have knowingly used Skechers' lower projections in its fairness evaluation of the transaction. The proposed class period runs from April 24, 2025, until the acquisition closed on Sept. 12 that year. A Skechers spokesperson declined to comment on the litigation. The allegations are contained in the plaintiff's complaint and have not been adjudicated.
The complaint alleges that Skechers' officers disseminated false and misleading statements, omitted material facts and manipulated financial projections to deflate the share price and facilitate a more lucrative deal. The plaintiff says the officers' core objective was to buy out unaffiliated minority shareholders at an artificially depressed price of $63 per share of Class A common stock. Before announcing the deal, the company allegedly invoked the threat of a trade war between the U.S. and China to further depress the price, although it internally viewed the potential tariff impacts as minimal or even beneficial, the plaintiff contends.
The complaint focuses on the Greenberg family, Skechers' founders Robert and Michael Greenberg, who allegedly maintained their stake and control while shareholders were bought out at lower prices. The plaintiff contrasts the $63 cash-out with the alternate consideration option available to legacy shareholders, under which the Greenbergs reportedly received $57 per share in cash plus one equity unit per share in the post-closing private entity, with an expected per-unit capital contribution of $29, a nominal total of $86 per share. The plaintiff says this allowed the Greenbergs to receive over $1 billion in cash from 3G Capital while rolling over more than 18 million shares into the new Skechers Limited Liability Company. The complaint alleges 3G Capital was willing to provide this windfall in exchange for take-private terms that gave public shareholders unfairly low consideration.
Greenhill & Co. is alleged to have knowingly used Skechers' lower projections in its fairness evaluation of the transaction. The proposed class period runs from April 24, 2025, until the acquisition closed on Sept. 12 that year. A Skechers spokesperson declined to comment on the litigation. The allegations are contained in the plaintiff's complaint and have not been adjudicated.
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