Lacking Any Wholly Reliable Indicators of Fair Value, Court Adopts Respondent's DCF Model

BVLaw
Court Case Digests
July 14, 2020
7379 Computer Related Services, NEC
541512 Computer Systems Design Services
dissenting shareholder
discount rate, expert testimony, weighted average cost of capital (WACC), cash flow, discounted cash flow (DCF), merger price, statutory appraisal, projections, terminal value, comparable companies method, perpetual growth rate

Kruse v. Synapse Wireless, Inc.
2020 Del. Ch. LEXIS 238
US
State Court
Delaware
Court of Chancery of Delaware
Athen Sweet (petitioner); Christopher Noe, Ph.D. (company/respondent)
Slights

Summary

In appraisal action arising out of controller's buyout of minority stockholders, court finds there is no reliable market evidence as to target's fair value on merger date; none of expert valuations are "wholly reliable," but one expert's DCF analysis offers a "proportionately reliable conclusion."

See Also

Kruse v. Synapse Wireless, Inc.

In appraisal action arising out of controller’s buyout of minority stockholders, court finds there is no reliable market evidence as to target’s fair value on merger date; none of expert valuations are “wholly reliable,” but one expert’s DCF analysis offers a “proportionately reliable conclusion.”