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Full-Text Articles in Law
A Fair Price And A Fair Deal: On The Future Of 'Entire Fairness' In Freezeouts, Faith Stevelman
A Fair Price And A Fair Deal: On The Future Of 'Entire Fairness' In Freezeouts, Faith Stevelman
Articles & Chapters
Controlling shareholders can compel the sale of minorities’ shares in freezeouts, potentially to their financial detriment. To limit controllers’ opportunism and support the value of minorities’ investments, the Delaware supreme court has endorsed strong minority shareholder protections under the rubric of 'Entire Fairness' – the governing standard for cash-out mergers. However, the court of chancery has refused to apply Entire Fairness to tender offer freezeouts, and is advocating unifying freezeout doctrine around a looser, deferential standard of review. The influence of popular and Congressional concern over excess plaintiff lawyers’ fees and discovery costs is likely making itself felt, although the …
Going Private At The Intersection Of The Market And The Law, Faith Stevelman
Going Private At The Intersection Of The Market And The Law, Faith Stevelman
Articles & Chapters
Delaware's fiduciary doctrine governing going private transactions by controlling stockholders is presently in disarray. Controllers generally select between single step cash-out mergers and tender offers followed by short-form mergers to do these freezeouts, and they are subject to very different equitable standards depending on the format selected. Further disarray arises because the courts' longstanding commitment to strict scrutiny in freezeouts is in tension with the popular disfavor towards private class-action litigation. This disarray threatens minority investors' interests in freezeouts, and capital market values more broadly. First, the disparities in freezeout doctrine have encouraged controllers to arbitrage the legal standards for …
Fair Value And Fair Price In Corporate Acquisitions, Rutheford B. Campbell Jr.
Fair Value And Fair Price In Corporate Acquisitions, Rutheford B. Campbell Jr.
Law Faculty Scholarly Articles
In statutory corporate acquisitions, dissenters' rights entitle shareholders of acquired corporations to obtain a "fair value" for their consideration, while common-law fiduciary duties ensure that such shareholders receive a "fair price" in the transaction. Courts, however, have had difficulty defining and measuring fair value and fair price, leaving this area of the law in disarray. This Article reviews the current framework of appraisal rights and fiduciary duties and proposes refined definitions of fair value and fair price that are based on attractive moral and economic values widely shared by society. The proposal respects the expectations of shareholders and provides guidance …
The Case Against Shark Repellent Amendments: Structural Limitations On The Enabling Concept, Ronald J. Gilson
The Case Against Shark Repellent Amendments: Structural Limitations On The Enabling Concept, Ronald J. Gilson
Faculty Scholarship
The tactical history of the tender offer movement resembles an unrestrained arms race. Faced with offeror assaults in the form of Saturday night specials, various types of bear-hugs, godfather offers, and block purchases, target management responded with equally intriguing defensive tactics: the black book, reverse bear-hug, sandbag, show stopper, white knight, and, drawing directly on military jargon, the scorched earth. But however varied the labels given particular defensive strategies, they share the common characteristic of being responsive: They are available only after an offer is made and the battle for the target's independence joined. From the target's perspective, what was …