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The Honolulu Advertiser
Posted on: Friday, January 4, 2002

Business briefs

Advertiser Staff

Digital Island sued over stock

Digital Island Inc., an Internet provider of online ads and other services, was sued by a former stockholder who says the shares were undervalued in a $340 million buyout by the U.K.'s Cable & Wireless Plc.

The lawsuit, filed yesterday in Delaware Chancery Court by Martin Berkowitz, says Digital Island directors should have auctioned the formerly Honolulu-based company's common shares rather than sell them for $3.40 each in August to Cable & Wireless.

The suit says the stock was worth more after Digital Island announced a contract in May to deliver 860 million ads a day on Microsoft Corp.'s MSN Web site. The shares rose to $3.69 after the announcement, 29 cents higher than the previously agreed-upon sale price.

Directors, some of whom held valuable stock options, violated duties to stockholders "by rushing precipitously to close the deal with Cable immediately after the MSN agreement was announced," the suit says.

Berkowitz is seeking to rescind the sale, and collect damages and legal fees. Officials of San Francisco-based Digital Island weren't immediately available to comment on the lawsuit.


Campbell park parcel bought

An affiliate of local real estate investment firm Kurisu & Fergus has purchased 35 acres of Campbell Industrial Park property for $14 million from Bank of Hawaii, which took ownership of the asset last year from a developer.

The buyer, Black Development Corp., is considering adding to the 238,000 square feet of industrial buildings on the property, known as Komohana Park, according to Wally Nagao, a broker at Grubb & Ellis/CBI who handled the sale.