An investor sued private equity billionaire Alec Gores and other architects of United Wholesale Mortgage’s SPAC merger, claiming they sold out ordinary shareholders because the deal’s lopsided structure gave them a windfall no matter how it fared, Bloomberg reports.
The lawsuit targets Gores Group affiliates backing Gores Acquisition IV that combined with the lender to take it public as UWM Holdings. It doesn’t name UWM or its billionaire CEO Mat Ishbia — who recently bought the NBA’s Phoenix Suns and the WNBA’s Phoenix Mercury — as defendants.
The transaction’s backers “hastily negotiated the merger through a flawed and unfair process,” according to the suit filed in Delaware.
Gores IV shareholders voted in January 2021 to merge with the mortgage company. With a transaction value of $16.1 billion, it was the largest SPAC merger up to that point. Read more.
