Companies Face Tough Decision Under New Del. Appraisal Law

Delaware corporations can take steps to limit their costs in shareholder appraisal litigation when a new law kicks in Aug. 1.

However, while the companies can save money by making early payments to shareholders challenging the deal price in mergers and acquisitions, that also may inadvertently fuel more litigation by unlocking money for shareholder litigants.

Attorneys told Bloomberg BNA that the decision to take advantage of the changes to Delaware’s appraisal statute may not be straightforward, and involves both economic and strategic considerations.

“It should be an easy decision, but it’s not,” John Landry, a Los Angeles-based special counsel at ...