Gainey McKenna & Egleston Announces A Class Action Lawsuit Has Been Filed Against Span-America Medical Systems, Inc. (SPAN)

NEW YORK, May 26, 2017 -- Gainey McKenna & Egleston announces that a class action lawsuit has been filed against Span-America Medical Systems, Inc. (“Span-America” or the “Company”) (Nasdaq:SPAN) in the United States District Court for the District of South Carolina pursuant to which Span-America will be acquired by Savaria Corporation (“Parent”) through its wholly owned subsidiary, Savaria (SC), Inc. (“Merger Sub”) (collectively, “Savaria”). The Complaint, which alleges violations of the Securities Exchange Act of 1934 against Span-America, its Board of Directors (the “Board”), and Savaria.

On May 1, 2017, Span America’s Board caused the Company to enter into an agreement and plan of merger (the “Merger Agreement”) with Savaria. Pursuant to the terms of the Merger Agreement, Savaria commenced a tender offer (the “Tender Offer”) to purchase all of the issued and outstanding shares of Span common stock for $29.00 in cash per share, or approximately $80 million in total consideration (the “Offer Price”). The Tender Offer is set to expire at 5:00 p.m., New York City Time, on Thursday, June 15, 2017.

The Complaint alleges that the Proposed Transaction is the product of a flawed sales process that favored Savaria at the expense of Span’s shareholders. The Complaint also alleges that the Tender Offer price is grossly inadequate and substantially undervalues Span-America, whereby it is below the mean and median implied values based on Net Sales LTM that Baird calculated for Span; represents a 10.7x Enterprise Value/LTM EBITDA multiple, which is below the 16.9x Enterprise Value/LTM EBITDA from Bloomberg using Span’s Standard Industrial Classification (“SIC”) code; and does not account for the “significant synergies” that exist between Span’s and Savaria’s businesses.

If you wish to join the litigation, or to discuss your rights or interests regarding this class action, please contact Thomas J. McKenna, Esq. or Gregory M. Egleston, Esq. of Gainey McKenna & Egleston at (212) 983-1300, or via e-mail at [email protected] or [email protected].

Please visit our website at http://www.gme-law.com for more information about the firm.