Delaware Court of Chancery rejects transaction price as best measure of fair value

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Source: September 28 2016 | Ropes & Gray LLP

On May 31 2016 the Delaware Court of Chancery released its post-trial opinion on the closely watched appraisal action that arose from the buy-out of Dell Inc(1) by Michael Dell, its founder, along with a private equity backer.

Despite finding that the transaction had resulted from a disinterested, fair and robust process that would have “sailed through” a traditional fiduciary duty review, Vice Chancellor Laster nonetheless held, after a four-day trial featuring 1,200 exhibits and extensive witness testimony, including from five experts, that the $13.75 per share transaction price did not provide Dell stockholders with fair value for their shares.

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