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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 rights, to increased value for shareholders, and that is in line with the proxy guidelines suggestion.…
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 relevant to the Delaware Supreme Court as it considers the Aruba appeal. For more on Aruba, see our multiple posts
On March 27, 2019, at 10 a.m., the Delaware Supreme Court will hold argument in the Aruba Networks appraisal case. We’ve covered the Aruba decision before, along with some of the impact the case has had on the appraisal landscape. Little doubt the argument before the Delaware Supreme Court will be enlightening to anyone interested in appraisal; we’ll have a further update after the argument.…
The vast majority of publicly announced mergers are approved by shareholders, certainly more than 90% no matter how you reasonably slice the data.  One way to view this data is that shareholder votes are perfunctory rubber stamps; but another is to view the merger process as self-selecting – a publicly announced merger is one that acquirer and target believe will receive shareholder approval.  In the latter case, the threat of failure is the motivating factor…
No. At least according to Vice Chancellor Slights III in the case In re Xura, Inc. Stockholder Litigation, C.A. No. 12698-VCS (Del. Ch. Dec. 11, 2018).  While it is true that in many circumstances appraisal is the exclusive remedy… not always! Xura highlights that the facts of each case matter and that an investor needs to think about the full suite of their potential claims and options in any merger dispute. For more on Xura,…
In 2017, Rwanda amended its companies act and introduced appraisal rights for minority shareholders [.pdf].  A recent article in the New Times provides an overview of, and reflects on, the efficacy of Rwandan appraisal.  The parallels between Rwandan appraisal (as described in the links provided) and Delaware appraisal are notable: appraisal is offered to dissenting shareholders who would otherwise be forced to accept certain major corporate actions (such as a merger); the dissenting shareholder must…
Probably not.  But this interesting analysis on the possibility of crypto asset mergers certainly allows for the possibility. We’ve covered blockchain and appraisal before, including the possibility of having shares put onto a blockchain, allowing for easier tracing, counting, voting, and other improvements over the current system of fungible bulk; but this is something different.  If one crypto asset (one blockchain community effectively) ‘merges’ with another, it could be a rule of the crypto asset…
Earlier in 2018, the Tennessee Supreme Court clarified Tennessee’s appraisal and valuation law in the case Athlon Sports Communications v. Duggan. Tennessee had long followed the “Delaware Block” system of valuation. The Delaware Block system averages market value, asset value, and earnings value to arrive at a valuation. But as one commentator has observed  “In the last 25 years, the traditional Delaware Block framework has become outmoded and less relied on by courts
In the 12th Edition of the Mergers and Acquisitions Review, the entry regarding the Caymans Islands includes discussion of the Cayman appraisal regime and confirms what other commentators have observed: Cayman Islands appraisal is in flux as the result of appeals of some of the first major appraisal decisions in that jurisdiction.  Like in Delaware, Cayman courts have to contend with various precedents, some of which are later overturned or modified.  In particular, recent Cayman…