Chancery Court Determines Value of Shares by Applying Average of GPCM and DCF Methodologies

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Court Case Digests
August 14, 2023

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shareholder dissent/oppression
fair value, forecast, appraisal, cash flow, discounted cash flow (DCF), merger, stock, stock price, projections, premium, comparable, guideline public company method (GPCM), enterprise
HBK Master Fund L.P. v. Pivotal Software, Inc.
2023 Del. Ch. LEXIS 332; 2023 WL 5199634
US
State Court
Delaware
Court of Chancery
Murray Beach
C. McCormick

Summary

In a long and complex opinion, the Delaware Court of Chancery determined the value per share of stock in a former stockholder’s appraisal action. The per-share value was reached by ascribing equal weight to adjusted versions of the comparable companies analysis (GPCM) the stockholder advanced and the discounted cash flow analysis the company advanced. The other methodologies were rejected. The use of the GPCM represented the first use of that method in some years.

See Also

HBK Master Fund L.P. v. Pivotal Software, Inc.

Full Text of Court Cases
August 14, 2023

In a long and complex opinion, the Delaware Court of Chancery determined the value per share of stock in a former stockholder’s appraisal action. The per-share value was reached by ascribing equal weight to adjusted versions of the comparable companies analysis (GPCM) the stockholder advanced and the discounted cash flow analysis the company advanced. The other methodologies were rejected. The use of the GPCM represented the first use of that method in some years.