Stakeholders of the networking chip maker Broadcom Corp. are apparently unhappy with the company’s decision to sell itself to rival chip maker Avago Technologies Inc. in a $37 billion deal, and have made their displeasure known by launching a class action lawsuit aimed at blocking the sale.

The merger between the two companies was announced last May, and is expected to close in March next year. Once the deal is closed, or should we say if the deal is closed, the newly combined firm would be worth $77 billion, the companies said.

However, Broadcom’s disgruntled shareholders say that the company has breached its fiduciary duties of loyalty and care that it owes to them, Zacks.com reported.

According to the lawsuit, Broadcom’s execs filed “a materially false and misleading registration statement” on Form S-4 with the U.S. Securities and Exchange Commission (SEC) in order to secure shareholder’s approval for the deal. As a result, the investors say they are getting less than their fair and proportionate share of the company’s continued success and future growth prospects.

“The omitted and/or misrepresented information is believed to be material to Broadcom shareholders’ ability to make an informed decision whether to approve the Proposed Transaction,” said Weiss Law, the law firm representing the shareholders.

The law firm added it’s also investigating whether or not Broadcom’s management effectively pursued alternatives to the acquisition, and whether they obtained the best price possible for the company’s shares.

According to the definitive merger agreement signed between the two companies, “Broadcom shareholders will receive $54.50 in cash and 0.4378 of an Avago share” for each share held.

The class action lawsuit filed by the firm seeks injunctive relief for the concerned plaintiffs and all other Broadcom shareholders who are in a similar situation.

Photo Credit: °]° via Compfight cc