Judge Dismisses ARV Suit Against Main Shareholder
An Orange County judge dismissed a lawsuit Friday brought by Costa Mesa-based ARV Assisted Living Inc. against a Lazard Freres & Co. affiliate, clearing the way for Lazard Freres to acquire an ARV competitor in the rapidly growing business of operating residences for the frail elderly.
Judge John C. Woolley dismissed all counts against Lazard Freres Real Estate Investors, which is ARV’s largest shareholder and an affiliate of the New York investment bank.
Shareholders of the competitor, Atria Communities in Louisville, Ky., will vote Sept. 8 on their company’s acquisition by Lazard, said a spokesperson for the investment firm.
“We’re naturally gratified,” said Robert P. Freeman, a principal of the Lazard Freres affiliate. “We hope this ends the uncertainty for Atria stockholders and employees.”
The Lazard Freres affiliate plans to buy Atria through its Kapson Senior Quarters unit, which Lazard acquired this year for about $244 million. Kapson expects to pay $750 million for Atria.
In May, ARV sued the Lazard Freres affiliate, which owns 47.9% of its stock, claiming the Atria deal couldn’t proceed without approval of 75% of ARV’s board members.
Suzanne C. Shirley, a spokeswoman for the Costa Mesa company, said ARV had wanted to lease and operate properties owned by Kapson but couldn’t reach agreement on leasing rates.
Howard Phansteil, ARV’s chairman, said the company is disappointed with the judge’s ruling. He said it is looking into alternatives to expand its business.
