Alleged Financial Distress Insufficient to Support Grant of Preliminary Injunction


The Delaware Court of Chancery denied a request for a preliminary injunction, finding that allegations of "financial distress" failed to demonstrate the imminent, irreparable harm required to obtain immediate injunctive relief.

Defendant Cementos Portland Valderrivas held a majority stake in both Uniland S.A. and Giant Cement Holding, Inc. In December 2010, Cementos sold Giant to Uniland. Plaintiff Sagarra Inversiones, S.L., a minority shareholder of Uniland, alleged that the acquisition price was improperly inflated as a result of Cementos's self-dealing and position on both sides of the transaction. Under the stock purchase agreement governing the acquisition, the merger consideration was to be paid in installments. Sagarra moved for interim injunctive relief to prevent the payment of any additional funds under the agreement.

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Published In: Civil Remedies Updates, General Business Updates, Finance & Banking Updates, Mergers & Acquisitions Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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