Callisto Investor Challenges Proposed Synergy Merger

Law360, New York (August 13, 2012, 1:07 PM EDT) -- An institutional investor on Thursday filed a putative class action against Callisto Pharmaceuticals Inc. in New York state court, trying to block a proposed merger with Synergy Pharmaceuticals Inc. that would cancel the 40 percent stake Callisto currently holds in Synergy.

Shona Investments Inc. claims that the stock-for-stock merger, which was announced July 20 and is expected to close by November, shortchanges Callisto's investors, who will receive 0.17 shares of newly issued Synergy stock for each Callisto share they own.

The deal values Callisto shares at...
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