Flawed Sales Process Has Chancery Revert to DCF to Determine Fair Value

BVLaw
Court Case Digests
July 27, 2018
2434 Wood Kitchen Cabinets
337110 Wood Kitchen Cabinet and Countertop Manufacturing
shareholder dissent/oppression
beta, expert testimony, fair value, discounted cash flow (DCF), merger, merger price, statutory appraisal, synergy, projections, going concern value

Blueblade Capital Opportunities LLC v. Norcraft Cos.
2018 Del. Ch. LEXIS 255
US
State Court
Delaware
Court of Chancery of Delaware
David A. Clarke (petitioners); Yvette R. Austin Smith (respondent/company)
Slights

Summary

Chancery rejects deal price as indicator of fair value, citing problematic sales process, and rejects use of unaffected trading price, citing company’s lack of trading history; court instead relies on its own DCF analysis, drawing on the most credible aspects of each expert’s analysis.

See Also

Blueblade Capital Opportunities LLC v. Norcraft Cos.

Chancery rejects deal price as indicator of fair value, citing problematic sales process, and rejects use of unaffected trading price, citing company’s lack of trading history; court instead relies on its own DCF analysis, drawing on the most credible aspects of each expert’s analysis.