The Shareholder Forumtm

support of long term investor interests in

Appraisal Rights


Intrinsic Value Realization




The Delaware Supreme Court issued a ruling on December 14, 2017 that endorsed its interpretation of the "Efficient Market Hypothesis" as a foundation for relying upon market pricing to define a company’s “fair value” in appraisal proceedings. The Forum accordingly reported that it would resume support of marketplace processes instead of judicial appraisal for its participants' realization of intrinsic value in opportunistically priced but carefully negotiated buyouts. See:

December 21, 2017 Forum Report

 Reconsidering Appraisal Rights for Long Term Value Realization



Forum reference:

Appraisal arbitrage fund managed by lawyer takes adventurous position in buyout priced for strategic business combination


For legal analyses of Delaware appraisal valuation standards, including risks relating to deductions of value attributable to a transaction's combination of businesses, see


Source: Law360, August 4, 2015 article

Funds Seek DirecTV Stock Appraisal After $48.5B AT&T Deal

By Matt Chiappardi

Law360, Wilmington (August 4, 2015, 2:19 PM ET) -- Two Merion Capital Group investment funds asked the Delaware Chancery Court to appraise their DirecTV stock late Monday after the recent $48.5 billion merger with AT&T Inc., opening yet another appraisal proceeding in The First State of a high-profile deal.

The petition from Merion Capital LP and Merion Capital II LP says that the two funds owned nearly 973,000 common shares of DirecTV between them and received $93.3767 per unit after the massive deal with AT&T was completed in July.

But the funds are seeking to have the Chancery Court actually determine the value of its shares.

“Petitioners did not vote the appraisal shares, and petitioners have not otherwise consented to the merger agreement,” the petition states. “Each petitioner is entitled to an appraisal of its portion of the appraisal shares.”

Representatives for Merion and AT&T did not immediately respond to requests for comment Tuesday.

Appraisal demands have gained momentum over the past few years in Delaware, with many coming as an investment tactic from institutional investors trying to squeeze more value out of public tie-ups, and several well publicized deals are awaiting the results of a look under the Chancery Court’s microscope.

Dole Food Co. chief David H. Murdock’s $1.6 billion take-private deal for the fruit producer is the subject of an appraisal demand by several institutional investors as well as a challenge by shareholders that the CEO helped orchestrate a series of moves to tank the stock and grab the 40 percent he didn’t own on the cheap.

Dozens of investors have also petitioned for appraisal in connection with Dell Inc.’s $25 billion go-private deal, a case that recently saw Vice Chancellor J. Travis Laster rule that five asset managers are not eligible for appraisal because they didn’t meet Delaware’s continuous ownership requirement after they re-titled them in the name of Cede & Co., the Depository Trust Company’s partner and nominee.

The AOL Inc. merger with Verizon Communication Inc. has also been the subject of appraisal petitions and the court recently ruled that the $1.6 billion buyout of was indeed fair, rejecting arguments the $32-per-share transaction should have been up to $15 higher.

The AT&T merger with DirecTV has been baking since at least May 2014, and finally received U.S. Federal Communications Commission approval in July after the companies agreed to build out their high-speed network and to abide by some net neutrality-related fixes.

The deal faced opposition from Netflix Inc., a host of rivals including Dish Network Corp., Cogent Communications Inc. and public interest groups, many of which argued it would increase prices for consumers.

AT&T and DirecTV have long insisted that the tie-up would benefit consumers, and that suggestions a merged company would intentionally slow down video streams from other content providers were baseless and that such a practice would drive away AT&T's own customers.

When the tie-up was announced, it came amid a wave of merger talks in the telecom and television sectors, and one megadeal, Comcast Corp.'s $45 billion bid to take over Time Warner Cable Inc, fell apart in April in the face of FCC and U.S. Department of Justice opposition.

Merion is represented by David J. Margules and Elizabeth A. Sloan of Ballard Spahr LLP.

Counsel information for AT&T was not immediately available Tuesday.

The case is Merion Capital LP et al. v. DirecTV, case number 11361, in the Delaware Chancery Court.

--Additional reporting by Kerry Benn, Benjamin Horney, Melissa Lipman, Matthew Perlman and Zachary Zagger. Editing by Emily Kokoll.


© 2015, Portfolio Media, Inc.


The program supporting Appraisal Rights Investments was conducted by the Shareholder Forum for invited participants according to stated conditions, including standard Forum policies that each participant is expected to make independent use of information obtained through the Forum and that participant identities and views will not be reported without explicit permission..

The information provided to Forum participants is intended for their private reference, and permission has not been granted for the republishing of any copyrighted material. The material presented on this web site is the responsibility of Gary Lutin, as chairman of the Shareholder Forum.

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.