Posted by Martin Lipton and Theodore N. Mirvis, Wachtell, Lipton, Rosen & Katz, on Friday, June 3, 2016
Editor's Note: Martin Lipton is a founding partner of Wachtell, Lipton, Rosen & Katz, specializing in mergers and acquisitions and matters affecting corporate policy and strategy. Theodore N. Mirvis is a partner in the Litigation Department at Wachtell, Lipton, Rosen & Katz. This post is based on a Wachtell Lipton memorandum by Mr. Lipton, Mr. Mirvis, William Savitt, and Ryan A. McLeod. This post is part of the Delaware law series; links to other posts in the series are available here.
In an appraisal decision issued this week, the Delaware Court of Chancery held that the fair value of Dell Inc. was $17.62 per share—almost four dollars over and nearly 30% more than the price paid in the 2013 go-private merger. In re Appraisal of Dell Inc., C.A. No. 9322-VCL (Del. Ch. May 31, 2016). The result reflects the remarkable view that “fair value” in Delaware represents a price far higher than any buyer would have been willing to pay and that the merger price derived from an admirable sales process should be accorded no weight.