On Jan. 30, 2019 food wholesaler United Natural Foods, Inc. (UNFI) America’s premier food wholesaler filed a multi-count lawsuit in the Supreme Court of the State of New York against Goldman Sachs Group, its principal executive, Bank of America and Merrill Lynch, Pierce, Fenner & Smith Inc. to recover damages and recoup the bank’s ‘ill-gotten gains stemming from its improper conduct during the period in which it advised UNFI on the $2.9 billion acquisition of Supervalu.’
In its complaint UNFI states the defendants are liable for breach of contract for misappropriating $40.5 million in term loan-related marketing period fees Goldman Sachs withheld from the funding it was obligated to provide and paid itself despite not being entitled to do so. The company also said the defendants are liable for breach of contract for withholding $11.4 million in advisory fees from the its term loan and that they dealt with UNFI in bad faith and unfairly in excess of an additional $140 million.
“We feel we have an obligation to hold Goldman Sachs and others accountable for the ways in which they materially harmed UNFI and its shareholders in arranging the financing and managing related activities for our acquisition of Supervalu,” said Steve Spinner, UNFI’s CEO and Chairman. “We expected our extremely well-paid transaction advisors to provide ethical counsel and unbiased support around this landmark acquisition—not leverage their positions to pursue larger profits for themselves and other clients at our expense and ongoing damage. UNFI is completely committed to the Supervalu combination and firmly believes in its many benefits and synergies, as we have repeatedly exhibited, but we are also determined to pursue our claims against the defendants for their unlawful acts surrounding the deal,” Spinner said.