News & Analysis as of

Mergers Appraisal

Morris James LLP

Court of Chancery Re-Affirms that Director-Designating Investor is Entitled to Privileged Communications from Company Counsel in...

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An employee, agent or principal of an investor is often designated to serve on a company’s board of directors when that company receives an investment or acquires the investor. That board member then becomes privy to legal...more

Hogan Lovells

Ramcell, Inc. v. Alltel: DE Court averages valuation models to arrive at fair market value of shares

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In Ramcell, Inc. v. Alltel Corp., C.A. No. 2019-0601-PAF (Del. Ch. July 1, 2022), the Court of Chancery reviewed a 2019 short-form merger between Alltel Corporation (Alltel) and Jackson Cellular Telephone Co. (Jackson), that...more

Morris James LLP

Delaware Supreme Court Explains Appraisal Rights and Finds Disclosure Violation Relating to Pre-Closing Dividend Contingent on a...

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In re GGP, Inc. Stockholder Litig., C.A. No. 2018-0267 (Del. July 19, 2022) - Here, the defendants organized a merger so that a large majority of the total value of the merger would be granted as a pre-closing dividend to...more

Skadden, Arps, Slate, Meagher & Flom LLP

In Appraisal Cases, Court of Chancery Increases Deal Price-based Valuation if Evidence Shows Pre-Closing Change

For the purposes of a statutory appraisal under Delaware law, a corporation’s fair value is determined “on the date of the merger” ― in other words, at closing, not signing. However, deal terms, including price, are typically...more

Cooley LLP

Delaware (Again!) Requires Upward Adjustment to Deal Price in Appraisal Proceeding Despite Objectively Fair Sales Process

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A recent Court of Chancery decision adds yet another wrinkle to the appraisal landscape and the potential for appraisal arbitrage. In BCIM Strategic Value Master Fund LP v. HFF, Inc. (Del. Ch. Feb. 2, 2022), the court found...more

Foley & Lardner LLP

Lessons On Conflicted-Party Transactions from NC Ruling

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The North Carolina Supreme Court recently concluded that shareholders dissenting from Reynolds American Inc.'s 2017 merger with British American Tobacco were not entitled to more consideration than the deal price — even in a...more

Troutman Pepper

Upshots of Del. Holding on Appraisal Rights Waivers in M&A

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In what represents a victory for private equity and venture capital investors, on Sept. 13, the Delaware Supreme Court issued a decision in Manti Holdings LLC v. Authentix Acquisition Co., confirming the enforceability of...more

Morris James LLP

Delaware Supreme Court Upholds Contractual Waiver of Statutory Appraisal Rights

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Manti Holdings, LLC, et al. v. Authentix Acquisition Co., Inc., No. 354, 2020 (Del. Sept. 13, 2021) - This decision arose out of the acquisition of Authentix Acquisition Company, Inc. and a subsequent appraisal proceeding...more

Hogan Lovells

Manti Holdings: Delaware Supreme Court permits advance waiver of appraisal rights Quarterly Corporate / M&A Decisions update...

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In Manti Holdings, the Delaware Supreme Court affirmed a decision that a corporation can enforce an advance waiver of appraisal rights against its stockholders. In a stockholders agreement, the petitioners agreed to “refrain...more

Clark Hill PLC

Is Arizona Putting a Chill on Freeze-Out Mergers?

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Dealing with – or being – a minority shareholder can be problematic, and friction between majority and minority owners is not uncommon. The majority owner may find itself hamstrung in its efforts to conduct business by the...more

Morris James LLP

Superior Court CCLD Dismisses Complaint Seeking Insurance Coverage for Appraisal Proceeding

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Jarden, LLC v. ACE Am. Ins. Co., C.A. No. N20C-03-112 AML CCLD (Del. Super. July 30, 2021) - Director and corporate liability insurance coverage is determined by the specific language of the insurance policies. Last year,...more

McGuireWoods LLP

Delaware Supreme Court Upholds Enforceability of Appraisal Rights Waiver

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In Manti Holdings, LLC v. Authentix Acquisition Co., Inc., decided Sept. 13, 2021, the Delaware Supreme Court upheld a lower court ruling that common stockholders’ statutory right to a court determination of the fair value of...more

Troutman Pepper

Appraisal Waivers Are Enforceable Under Delaware Law

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On September 13, the Delaware Supreme Court issued a decision in Manti Holdings LLC v. Authentix Acquisition Co., confirming the enforceability of appraisal waivers by private contract so long as the stockholders agreeing to...more

Hogan Lovells

In re Appraisal of Regal: deal-price-less-synergies valuation method is “first among equals”

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The court’s decision in In re Appraisal of Regal Entertainment Group (C.A. No. 2018-0266-JTL (Del. Ch. May 13, 2021)) is the most recent in a line of cases confirming that the deal-price-less-synergies valuation method is the...more

Hogan Lovells

Manichaean Capital v. Exela Tech: DE courts rule on “reverse veil piercing” claims - Q2 2021 Quarterly Corporate / M&A Decisions...

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In Manichaean Capital, LLC v. Exela Tech., Inc. (C.A. No. 2020-0601-JRS (Del. Ch. May 25, 2021)), the Court of Chancery ruled as a matter of first impression in Delaware that plaintiffs could pursue “reverse veil piercing”...more

Cooley LLP

Blog - Keeping Up with Delaware Appraisal Jurisprudence Since Aruba: Deal Price Reigns Supreme, But Will Recent Decision Lead to...

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In a string of seminal decisions from 2017 through 2019 (DFC Global, Dell and Aruba), the Delaware Supreme Court re-shaped appraisal jurisprudence, in each case by overturning the Court of Chancery for failing to give...more

Snell & Wilmer

Delaware Court of Chancery Adopts Reverse Veil-Piercing

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In a case of first impression in Delaware, the Court of Chancery adopted the equitable doctrine of reverse veil-piercing1 in Manichaean Capital LLC v Exela Technologies Inc., a post-merger action to enforce an appraisal...more

Morris James LLP

Chancery Holds Prior Rulings in Appraisal and Securities Litigation Do Not Bar New Columbia Pipeline Fiduciary Duty Action

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In re Columbia Pipeline Group, Inc. Merger Litigation, C.A. No. 2018-0484-JTL (Del. Ch. Mar. 1, 2021) Certain judicial doctrines, including collateral estoppel and stare decisis, promote efficiency and finality by barring...more

Dorsey & Whitney LLP

Mergers Involving Delaware LLCs Don’t Trigger Appraisal Rights - Except When They Do

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When parties consider an M&A transaction involving a merger, a factor that is top of mind for counsel is complying with the statutory appraisal procedures afforded to holders of equity in the merging entity who do not consent...more

Patterson Belknap Webb & Tyler LLP

Second Department Limits Plaintiff to Appraisal Remedy Under New York LLC Law After a Freeze-out Merger

In Farro v. Schochet, the Second Department recently held that §1002 of the NY LLC Law restricted a dissenting member’s remedy to an appraisal for the fair value of his interest in the business after a freeze-out merger....more

Akin Gump Strauss Hauer & Feld LLP

Capitalizing on Merger Arbitrage Investment Opportunities in Asia Pacific Markets

Returns from Asia-Pacific merger arbitrage positions have proved consistently attractive over time, offering the additional benefit of portfolio diversification when compared to other equity strategies where returns are more...more

Morris James LLP

Delaware Supreme Court Affirms Use of Unaffected Market Price to Determine Public Corporation’s “Fair Value” in Appraisal...

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Fir Tree Value Master Fund, L.P. v. Jarden Corp., No. 454, 2019 (Del. July 9, 2020) - Adding to its appraisal jurisprudence, the Supreme Court of Delaware recently affirmed the use of the unaffected trading price of a...more

Morris James LLP

Chancery Values Non-Public Company with No Reliable Market-Based Data Using Discounted Cash Flow Analysis

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Kruse v. Synapse Wireless, Inc., C.A. No. 12392-VCS (Del. Ch. July 14, 2020) - This case illustrates how appraisal works outside of the public market context when a lack of data hinders a reliable valuation. Here,...more

Jones Day

Delaware Supreme Court Upholds Unaffected Market Price in Statutory Appraisal Action

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The Situation: Stockholders sought appraisal—judicial determination of the "fair value" of their stock—in connection with a merger. The Delaware Court of Chancery found that the fair value was equal to the company's...more

Saul Ewing LLP

2020 Delaware General Corporation Law & Alternative Entity Amendments

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On July 16, Delaware Governor John Carney signed into law the 2020 amendments to the General Corporation Law of the State of Delaware (the “DGCL”), the Delaware Limited Liability Company Act (the “LLC Act”), the Delaware...more

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