DFC Global: Delaware Supreme Court Emphasizes Role of the Market in Certain Appraisal Proceedings
November 2017
Publication
The number of proceedings under Section 262 ofthe Delaware General Corporation Law (DGCL),in which stockholders who have not voted in favorof a merger and have otherwise perfected their rightto seek a judicially determined assessment of the“fair value,” in cash, of their shares, has increasedsignificantly over the past few years, providing thecourts with additional opportunities to explore theappropriate methods of assessing fair value. AlthoughSection 262 of the DGCL expressly provides thatthe Court of Chancery, in assessing fair value, “shalltake into account all relevant factors,” a trend hasemerged, principally in third-party transactions inwhich the target corporation was shopped, in whichthe Court has given significant (if not exclusive)weight to the deal price in appraising the sharessubject to the proceeding.