In a recent appraisal decision, Delaware Vice Chancellor Slights III awarded investors a 12% premium above deal price, fully adopting the discounted cash flow analysis Petitioners tendered, except for one minor adjustment. The case involved a three-way business combination of a privately held target turned public without minority shareholder approval. The court eschewed the use of market evidence because SourceHOV did not trade in an efficient market, and there was no “real effort to run a ‘sale process.’” Instead, the Vice Chancellor wrote, “I have more confidence in Petitioners’ presentation than I have in my own ability to translate any doubts I may have about it into a more accurate DCF valuation.” The decision can be found here.

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