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The Shareholder Forumtm

special project of the public interest program for

Fair Investor Access

Supporting investor interests in

appraisal rights for intrinsic value realization

in the buyout of

Dell Inc.

For related issues, see programs for

Appraisal Rights Investments

Fair Investor Access

Project Status

Forum participants were encouraged to consider appraisal rights in June 2013 as a means of realizing the same long term intrinsic value that the company's founder and private equity partner sought in an opportunistic market-priced buyout, and legal research of court valuation standards was commissioned to support the required investment decisions.

The buyout transaction became effective on October 28, 2013 at an offer price of $13.75 per share, and the appraisal case was initiated on October 29, 2013, by the Forum's representative petitioner, Cavan Partners, LP. The Delaware Chancery Court issued its decision on May 31, 2016, establishing the intrinsic fair value of Dell shares at the effective date as $17.62 per share, approximately 28.1% more than the offer price, with definitive legal explanations confirming the foundations of Shareholder Forum support for appraisal rights.

Each of the Dell shareholders who chose to rely upon the Forum's support satisfied the procedural requirements to be eligible for payment of the $17.62 fair value, plus interest on that amount compounding since the effective date at 5% above the Federal Reserve discount rate.

Note: On December 14, 2017, the Delaware Supreme Court reversed and remanded the decision above, encouraging reliance upon market pricing of the transaction as a determination of "fair value." The Forum accordingly reported that it would resume support of marketplace processes instead of judicial appraisal for the realization of intrinsic value in opportunistically priced but carefully negotiated buyouts.


Forum distribution:

Another court decision in Dell appraisal case defines standards for bearing costs


For the court's careful definition of responsibilities for a petitioner's fees and expenses in what has become a model case for appraisal rights, see


Source: Law360, October 17, 2016 article

Shareholders' Attorneys Win Fee Bid In Dell Appraisal Suit

By Martin O'Sullivan

Law360, Wilmington (October 17, 2016, 6:04 PM EDT) -- A Delaware Chancery judge on Monday approved $4 million in expenses and roughly the same in attorneys' fees for the lead law firm in the case that found that Dell’s nearly $25 billion take-private deal was undervalued by almost 30 percent.

Grant & Eisenhofer PA, which served as lead counsel to shareholders seeking stock appraisal of the computer giant’s nearly $24.9 billion take-private deal, can collect up to $4,007,462 in expenses and up to $4,044,090 in attorneys' fees, according to Vice Chancellor J. Travis Laster.

“This decision awards the requested amount of fees and expenses,” Vice Chancellor Laster said in a written opinion. “The amounts are reasonable.”

Vice Chancellor Laster in May ruled that the fair value of Dell stock at the time of its $25 billion take-private deal was $17.62 per share, nearly $4 higher than the transaction price.

Laster wrote that while the deal price of $13.75 per share was an important factor in determining the fair value of Dell’s shares, there was enough evidence presented during a four-day appraisal trial in October that suggested there was a “valuation gap” between transaction price and actual intrinsic price.

Shareholders who petitioned for appraisal of their stock, which included heavyweights like T. Rowe Price, had argued the price of Dell should be even higher, with their experts at trial pegging the actual share-price value at $28.61.

On the Dell side, its expert thought the price should be even lower than the deal consideration, setting it at $12.81, and the vice chancellor essentially took those two opinions, which show a roughly $28 billion valuation gap between them, and split the difference.

The vice chancellor called the Dell expert’s opinion “conservative,” while he said the petitioners expert was “optimistic,” and averaged out the data where it conflicted to come to a fair value of $17.62.

Dell is represented by Gregory P. Williams, John D. Hendershot, Susan M. Hannigan and Andrew J. Peach of Richards Layton & Finger PA and John L. Latham, Susan E. Hurd, Gidon M. Caine and Charles W. Cox of Alston & Bird LLP.

The shareholders are represented by Stuart M. Grant, Michael J. Barry, Christine M. Mackintosh, Jennifer A. Williams and Rebecca A. Musarra of Grant & Eisenhofer PA.

The case is In re: Appraisal of Dell Inc., case number 9322, in the Court of Chancery of the State of Delaware.

--Additional reporting by Matt Chiappardi. Editing by Emily Kokoll.


© 2016, Portfolio Media, Inc.


This project was conducted as part of the Shareholder Forum's public interest  program for "Fair Investor Access," which is open free of charge to anyone concerned with investor interests in the development of marketplace standards for expanded access to information for securities valuation and shareholder voting decisions. As stated in the posted Conditions of Participation, the Forum's purpose is to provide decision-makers with access to information and a free exchange of views on the issues presented in the program's Forum Summary. Each participant is expected to make independent use of information obtained through the Forum, subject to the privacy rights of other participants.  It is a Forum rule that participants will not be identified or quoted without their explicit permission.

The management of Dell Inc. declined the Forum's invitation to provide leadership of this project, but was encouraged to collaborate in its progress to assure cost-efficient, timely delivery of information relevant to investor decisions. As the project evolved, those information requirements were ultimately satisfied in the context of an appraisal proceeding.

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Shareholder Forum™ is a trademark owned by The Shareholder Forum, Inc., for the programs conducted since 1999 to support investor access to decision-making information. It should be noted that we have no responsibility for the services that Broadridge Financial Solutions, Inc., introduced for review in the Forum's 2010 "E-Meetings" program and has since been offering with the “Shareholder Forum” name, and we have asked Broadridge to use a different name that does not suggest our support or endorsement.