Kelly, Murphy and Stirling Discuss Delaware Supreme Court's Reversal of Dell's Appraisal Decision Regarding Deal Price

Winter 2018
Christopher Kelly, Ryan Murphy and Jay Stirling
Deal Points: The Newsletter of the Mergers and Acquisitions Committee

On December 14, 2017, in a much-anticipated decision in the appeal from the Court of Chancery’s above-deal price appraisal of Dell Inc.’s stock following a buyout of the company by its founder and a private equity firm, the Delaware Supreme Court, sitting en banc, held that the Court of Chancery, which had given no weight to the $13.75 per share deal price and instead used exclusively a discounted cash flow analysis to find that the fair value of Dell was $17.62 per share (or 28 percent higher than the deal price), “erred in not assigning any mathematical weight to the deal price” because “the record as distilled by the trial court suggest[ed] that the deal price deserved heavy, if not dispositive, weight.”

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