Appraisal petitioners who receive a fair value award are entitled to interest as set by statute. In particular, DGCL § 262 provides that “. . . interest from the effective date of the merger, consolidation, conversion, transfer, domestication or continuance through the date of payment of the judgment shall be compounded quarterly and shall accrue
A new piece by Skadden focuses on some old, and some new factors regarding prepayment. Since the 2016 appraisal amendments, respondents in an appraisal proceeding have had the right to ‘prepay’ some or all of the merger consideration. The mechanics of this are basic, but deserve a moment of explanation. In appraisal proceedings, unlike in
The Delaware Supreme Court made its ruling this week in the ISN Software appraisal case. A three-judge panel (not the full bench) affirmed the Chancery Court’s decision awarding a premium that was more than 2.5 times the merger price, as reported in Law360 [$$]. The Supreme Court affirmed without rendering its own opinion, relying instead
As reported in Law360 [$$], 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
Law360 [$$] recently carried an analysis by a trio of Delaware attorneys regarding the impact of 2016’s prepayment amendment to Delaware appraisal law. Part of the August 2016 amendments allowed M&A targets to prepay dissenting shareholders an amount of their choosing, thereby stopping the accrual of interest on that portion of the merger price/amount at
Further to our prior post about Delaware’s two new appraisal decisions, SWS Group was a small, struggling bank holding company that merged on January 1, 2015 into one of its own substantial creditors, Hilltop Holdings. Stockholders of SWS received a mix of cash and Hilltop stock worth $6.92 at closing. Vice Chancellor Glasscock rejected the
Last week the Federal Reserve issued another rate hike, just months after its December rate increase. The recent hike has increased the Fed’s discount rate — also known as its primary credit rate — by 0.25%, up to 1.50%. Effective as of March 16, 2017, this will increase the rate of statutory interest in
Last month we wrote about the Lender Processing case, which ultimately awarded deal price and contained an instructive survey of recent appraisal law. For another view of this case, see the January 11, 2017 post on Harvard Corporate Governance.
The Federal Reserve’s recent rate hike, the second one in as many years, has increased the Fed’s discount rate — also known as its primary credit rate — by 0.25%, up to 1.25%. Effective as of December 15, this will increase the rate of statutory interest in appraisal cases to 6.25%, compounded quarterly, as
Today Vice Chancellor Laster issued a new appraisal ruling, Merion Capital LP v Lender Processing Services, pegging the appraised fair value to the merger price.
The court found no reason to depart from merger price given the apparently reliable sale process and reliable projections. The court performed its own DCF valuation, which came out