Merion Capital LP & Merion Capital II LP v. BMC Software

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Full Text of Court Cases
October 21, 2015
7372 Prepackaged Software
dissenting shareholder
expert testimony, fair value, discounted cash flow (DCF), merger, statutory appraisal, reliability, synergy, projections, equity risk premium (ERP), comparable companies method

Merion Capital LP & Merion Capital II LP v. BMC Software
2015 Del. Ch. LEXIS 268
US
State Court
Delaware
Court of Chancery
Borris J. Steffen (petitioners); Richard S. Ruback (company/respondent)
Glasscock

Summary

Chancery favors merger price, without synergy adjustment, over DCF-generated value, noting uncertainties over key inputs such as projections, equity risk premium, terminal growth rate as well as the “wildly divergent” DCF results of the parties’ experts.
Merion Capital LP & Merion Capital II LP v. BMC Software
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See Also

Uncertainty Over Key Inputs Compromises DCF, Chancery Says

Chancery favors merger price, without synergy adjustment, over DCF-generated value, noting uncertainties over key inputs such as projections, equity risk premium, terminal growth rate as well as the “wildly divergent” DCF results of the parties’ experts.