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Appraisal Rights Litigation Blog

Category Archives: Precedent Transactions

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Delaware Supreme Court 3-Judge Panel Hears Appeal in ISN Software Appraisal

Posted in Award Premium, Comparable Companies, Direct Capitalization of Cash Flows, Discounted Cash Flow Analysis, Fair Value, Interest on Appraised Value, Merger Price, Precedent Transactions, Supreme Court, Uncategorized

As reported in Law360 [$$], on October 11, 2017 the Delaware Supreme Court heard argument appealing the Chancery Court’s ruling in the ISN Software appraisal case.  We have previously posted on the trial court’s decision here, in which Vice Chancellor Glasscock awarded a premium to the merger price.  The Supreme Court did not rule and… Continue Reading

Delaware Chancery Again Rejects Merger Price and Awards Premium

Posted in Award Premium, Closely Held Target, Discounted Cash Flow Analysis, Discounted Net Income Analysis, Equity Risk Premium, Guideline Public Company Valuation, Independent Valuation, Merger Price, Perpetuity Growth Rate, Precedent Transactions

In Farmers & Merchants Bancorp, an appraisal case involving a small closely-held community bank that was sold in a stock-for-stock deal valued at $83 per share, Chancellor Bouchard disregarded merger price, as well as the “wildly divergent valuations” of both sides’ experts.  He arrived at an independent valuation of $91.90 per share based on his… Continue Reading

Delaware Chancery Again Awards Appraisal Uplift

Posted in Award Premium, Comparable Companies, Direct Capitalization of Cash Flows, Discounted Cash Flow Analysis, Fair Value, Interest on Appraised Value, Merger Price, Precedent Transactions

Delaware Chancery has again awarded appraisal petitioners a significant bump above the merger price.  In the ISN Software Corp. Appraisal Litigation, Vice Chancellor Glasscock was facing widely divergent valuation from the opposing experts, and relied exclusively on a discounted cash flow analysis as the most reliable indicator of fair value.  The court’s per-share valuation award… Continue Reading

With Unreliable Management Projections and No Market-Based Models, Delaware Chancery Pegs Fair Value to Merger Price

Posted in Appraisal Arbitrage, Discounted Cash Flow Analysis, Fair Value, Merger Price, Precedent Transactions, Synergies

Delaware’s latest appraisal decision in LongPath Capital v. Ramtron International Corp. adopted the merger price as its appraisal valuation, but stands apart from the other recent appraisal decisions that likewise fell back on transaction consideration. Here, the court’s lengthy opinion repeatedly lamented the lack of any remotely reliable means of valuation other than the merger… Continue Reading

Many Roads Lead to Enterprise Value

Posted in Comparable Companies, Discounted Cash Flow Analysis, Fair Value, Precedent Transactions

A widely followed corner of the blog is our “Valuation Basics” series, where in earlier posts we have described many of the components of the discounted cash flow analysis, the income-based valuation methodology preferred by Delaware’s Court of Chancery.  (See here, here, and here).  Earlier this month we examined a market-based valuation approach — the… Continue Reading