Google's acquisition of video compression firm On2
Technologies is being challenged in court by On2 shareholders
dissatisfied by Google's $106.5m offer.
The class action lawsuit filed in the Delaware Chancery Court
seeks a permanent injunction against the deal, according to the
New York Post.
Google announced
plans to acquire On2 earlier this month in a cash and stock
deal to boost its online video capabilities.
The agreement states that each share of On2 will be exchanged
for 60 cents' worth of Google common stock, but shareholders say
On2's stock traded at 65 cents in May.
The disgruntled shareholders also allege that On2's board agreed
to provisions that prohibit the company from considering other
offers.
The deal, which is expected to close in the fourth quarter of
this year, still needs the approval of On2 shareholders, but the
board has yet to announce a date for the vote.