Lawsuit claims Meredith-Media General deal a cushy payday for executives

In September, Virginia-based Media General announced its plans to acquire Meredith for $2.4 billion in cash and stock. The proposed acquisition of Meredith will land company executives and majority shareholders a cushy payday, while leaving minority shareholders in the dust, according to a lawsuit filed in federal district court. The lawsuit claims executives, board members and majority shareholders of the Des Moines-based publisher conspired and had conflicts of interest when orchestrating Meredith's acquisition. Meredith's acquisition "was approved by a majority-interested board who stood to profit from windfall financial benefits … as well as lucrative post-deal employment positions," the lawsuit reads.

The lawsuit also claims Meredith set up the acquisition with provisions that would make other bidders for Meredith shy away. For instance, the Meredith-Media General deal includes a $60 million termination fee, should either company end the deal. The lawsuit also mentions that Meredith family members who hold 63 percent of the company's Class B shares have already signed on in support of the acquisition.