Del Monte Corp and Barclays Capital agreed on Thursday to pay $89.4 million to settle a lawsuit that claimed they had not acted in investors' best interests in the food company's $4 billion takeover.

Lawsuits stemming from the takeover have raised conflict of interest issues and struck at the core of the relationship between banks and companies they advise, making boards and bankers nervous about how they run auctions.

In the lawsuit, investors claimed that Barclays, which advised Del Monte on the sale, had a conflict of interest because it also arranged financing for the private equity buyers led by KKR and Co . Banks helping to sell businesses frequently offer financing to buyers, known as 'staple financing.'

Del Monte will contribute $65.7 million and Barclays Capital, a unit of Barclays Plc , will pay $23.7 million to Del Monte's shareholders, the investors' lawyers said in a statement on Thursday.

Around $21 million of Del Monte's payment is in lieu of fees due to Barclays, meaning the two parties will carry a roughly equal burden.

In a filing with the U.S. Securities and Exchange Commission, Del Monte and Barclays denied any wrongdoing.

We are pleased that the parties have agreed to settle the litigation to avoid the expense, distraction and uncertainty of litigation. We believe that the sale process leading up to the merger achieved the best price reasonably available for Del Monte stockholders, a Barclays spokesman said in an email.

The settlement, subject to approval by Vice Chancellor J. Travis Laster, would resolve all litigation over the sale of Del Monte to the buyout group, the plaintiffs said. Their attorneys said the payout was one of the largest cash settlements on record in Delaware Chancery Court.

In February, Laster delayed a shareholder vote on the deal after accusing Barclays of secretly and selfishly manipulat(ing) the sale process to engineer a transaction to allow Barclays to collect large financing fees.

Del Monte hired boutique investment bank Perella Weinberg to look for superior bids after the February ruling, but none emerged.

This case has sharply reined in certain practices within the investment banking community, where many financial advisers regularly gamed the M&A process through double-dip engagements, said Randall Baron, an attorney for the plaintiffs and a partner with the law firm Robbins Geller.