Valuation and disclosure issues are central to much transaction-related litigation. Disclosure issues are also central in “quasi-appraisal” actions -- a post-closing approach plaintiffs may use if they do not deem proxy filing disclosures adequate.
We bring analytical rigor and familiarity with the framework generally adopted by courts in our work related to both valuation and disclosure issues. In the Delaware Chancery Court, we have computed fair value of equity of firms subject to an appraisal action. We have also addressed issues related to the deal process.
- Valuation: Disagreement over the standalone value of the target is frequently at the core of M&A-related disputes. In appraisal matters, courts often seem to prefer a discounted cash flow valuation of the target. We examine economic issues related to valuation, which include the reasonableness of forecasts, the appropriate discount rate, and taxation-related issues.
- Adequacy of disclosure and governance: Appraisal and quasi-appraisal matters also often involve allegations of inaccurate and incomplete disclosure to investors. We assess allegations focusing on disclosure issues in proxy filings, such as failure to make disclosures that were directly relevant to shareholders’ decision to approve a merger. We have also addressed the extent to which change of control provisions in a credit agreement of a firm could affect the ability of the firm to attract bidders.
- Forum Finding “True North” in Recent Delaware Appraisal Cases: Is It the Market or the Model?
- Related Practice Business Enterprise Valuation
Martin Marietta Materials, Inc. v. Vulcan Materials Company
- Featured Expert Jeffrey A. Cohen Managing Principal, Chicago
The Price Isn't Right: Event Studies In M&A SuitsLaw360, December 2010
- Featured Expert Thomas Lys Eric L. Kohler Emeritus Chair in Accounting and Professor of Accounting Information & Management, Kellogg School of Management, Northwestern University; Professor of Law (by courtesy), Northwestern University Law School