Backers of the blank-check merger that took UpHealth public lost their bid Wednesday to end litigation in Delaware over claims they duped investors into approving the transaction.
Vice Chancellor Lori W. Will let the proposed class action move forward, saying it’s plausible Israeli businessman Avi S. Katz and other affiliates of GigCapita l — which sponsored the shell company that combined with UpHealth — were driven by the deal’s lopsided structure to mislead shareholders about its details, Bloomberg reports.
If true, the allegations show the financiers were motivated to minimize opt-outs.
The deal closed in June 2021, when UpHealth shares were trading at $89.40. The stock last traded today at $2.18. Read more.
