Do stockholders as a group lose something when the appraisal remedy is weakened, perhaps overly so? And should something be done about it? Is there social utility in appraisal arbitrageurs testing merger prices, such as by keeping buyers and sellers honest in what may otherwise be a rather unfair market?
These questions are addressed, along
It looks likely – per this blog post from Deminor Recovery Services. With numerous US-listed People’s Republic of China (“PRC”) companies facing threats to their listings, the attractiveness of withdrawing from the US market may become stronger. Take privates, mergers, and other arrangements resulting in the delisting of the PRC company from the US exchange
The National Law Review has covered Mobile Posse, a case we’ve posted on before. The NLR analysis describes the Mobile Posse decision, writing:
“The Court denied all but one of defendants’ motions, finding numerous deficiencies in the notice process and finding that the merger was not entirely fair.”
And further:
“The Court was
Yes, in sum. The two terms are often used interchangeably in the literature. Certain countries or jurisdictions have a stronger tradition of referring to these important shareholder rights as either appraisal rights – focusing on the remedy – or dissenters rights – focusing on the entitlement. Arguably, dissenters rights may be thought of as broader
We’ve covered the Mobile Posse case before, specifically, how it shows the importance of getting the basics right regarding appraisal notices. The Delaware Litigation blog provides more on Mobile Posse, including a recap of whether a post-suit “do over” is available:
“The company sought a “do-over” or a mulligan for its statutory errors
The State Board of Administration of Florida’s proxy guidelines join a number of others in suggesting that investors vote FOR appraisal rights when available. For institutional investors, appraisal rights are a critical shareholder protection, especially in instances where the merger process raises questions or where market dislocation results in a value gap between merger and
We’ve covered before that major proxy voting analyst Taft-Hartley suggests investors vote in favor of appraisal rights and that a major pension fund’s guidelines likewise favor appraisal. Add Boston Partners, a major investment manager, to the list of those favoring appraisal rights in their proxy voting, according to their 2019 proxy voting guidelines [.pdf].
Appraisal rights can offer investors critical protections against corporate actions that do not provide shareholders fair value. Investors often recognize this – as we recently posted, proxy voting guidelines suggest investors vote in favor of appraisal. And then there are the Corporate Governance Principles [.pdf] of the Los Angeles County Employees Retirement Association (LACERA),
The Taft-Hartley Proxy Voting Guidelines for 2019 have been released by Institutional Shareholder Services. The guidelines, which many institutional investors follow, suggest that shareholders vote “for proposals to restore or provide shareholders with the right of appraisal.” As we’ve covered before, there is meaningful academic work tying the existence of, and exercise of appraisal
Seven years ago this week, in Roam-Tel Partners v. AT&T Mobility, C.A. 5745-VCS (Del. Ch. Dec. 17, 2010), then-Vice Chancellor Strine held that in a short-form merger, a stockholder can revoke its prior waiver of its appraisal rights within the twenty-day statutory election period, absent any prejudice to the corporation. In that case, the