Valassis No Longer Wants to Buy ADVO
LIVONIA, MI—Alleging fraud, Valassis Communications has sued ADVO in chancery court to rescind its $1.3 billion merger agreement. Valassis alleges that ADVO intentionally provided false information and “withheld material information” regarding operating income.
The suit also alleges ADVO executives knew of, but did not disclose, significant internal control deficiencies associated with ADVO’s order-to-cash system.
In a statement, ADVO believes the move may be “merely a smokescreen to hide the fact that Valassis is suffering from an extreme case of buyer’s remorse,” and plans to contest the action.