Valuation firm Willamette Management Associates has put out a pair of articles discussing the calculation and treatment of synergies in appraisal actions. At least in Delaware, the value of an appraisal petitioner’s shares is to be fixed as the fair value of the company less synergies. Synergies can thus become a significant battleground in an appraisal action – and can result in rulings below merger price.
For its part, Willamette reviews a number of the recent Delaware cases discussing synergies, as well as how relevant synergies will be when the “sales process” – now often described as “Dell compliance” – is considered. Synergistic value is subject to extensive expert debate, and, like any issue in valuation, is the source of competing expert opinions and briefing in effectively every case.