Appraisal is a remedy for shareholders who believe a merger is being consummated at below fair value. Appraisal is also a check on management and boards of directors – specifically, providing a ‘backcheck’ on whether the shareholder fiduciaries are achieving fair value for the company. Management buyouts are an acute case of mixed incentives for
Does the valuation method parties pursue, and that a Court uses, matter to the ultimate valuation of a firm? This recent paper studying data from Finnish appraisal of private terms over a 16 year period suggests that the choice of methodology does matter.
For readers of this blog, or those who know of appraisal predominantly
Law professors who filed an amicus brief in support of petitioners in the Aruba case have provided a useful summary of their arguments in this blog post from the Harvard Law Corporate Governance Forum. With market efficiency issues increasingly intersecting with more traditional valuation and process issues in appraisal cases, this amicus could be particularly
Appraisal cases increasingly focus on how markets react to merger news and what one learns from that. Recent cases that have looked to “unaffected” merger price – that is, the price of a share of the target company before the merger announcement – in part because of the fundamental truth that mergers are market moving