In re MFW Shareholders Litig.
DE Chancery adopts business judgment review standard where controlling stockholder buyout includes two procedural protections for minority and finds valuations from independent financial advisor demonstrate merger was favorable to minority stockholders.
Koehler v. Netspend Holdings Inc.
Court agrees with plaintiff shareholder that the proposed merger was the result of a defective sale process that included the company board’s reliance on a weak fairness opinion with valuations that were “poor indicators” of the company’s value; the sale ...
In re Greater Southeast Community Hospital Corp. (III)
In fraudulent conveyance action, court admits errors in its own discounted cash flow valuation of hospital, but denies motion to reconsider, finding the trustee has the burden to present competent expert evidence regarding reasonably equivalent value.
Tax Court Rejects GPCM, Dissects DCF in Valuing Minority LP Interest
Tax Court calculates value of a 41% family limited partnership (timberland assets) using a net asset value and DCF approach, the latter including a 25% DLOM and 16% discount rate, adjusted for unique risks.
Lost Profits Damages Cannot Contradict Contract Terms
Court accepts expert damages calculation for breach of contract based on DCF methodology, including growth rate and discount rate assumptions, but precludes terminal value calculation that violated nonassignment clause.
Estate of Giustina v. Commissioner (I)
Tax Court calculates value of a 41% family limited partnership (timberland assets) using a net asset value and DCF approach, the latter including a 25% DLOM and 16% discount rate, adjusted for unique risks.
Allstate Sweeping, LLC v. City and County of Denver
Court accepts expert damages calculation for breach of contract based on DCF methodology, including growth rate and discount rate assumptions, but precludes terminal value calculation that violated nonassignment clause.
In re Boston Generating
Court authorizes $1.1 billion asset sale of the debtors, despite DCF by lenders’ expert that shows $13.8 billion value.
Management Projections, Always Suspicious, Now Receive Even More Review
Management projections have always required scrutiny. However, now it seems they often require outright skepticism. And if they don’t receive this level of examination from the business appraiser, then they’ll get it from the auditors, the reviewers, the ...
ASARCO v. Americas Mining Corp. (II)
Federal district court considers whether control premium can be an element of damages in fraudulent transfer/breach of fiduciary duties in bankruptcy case.
M.A. Hajianpour, M.D., P.A., et al. v. Khosrow Maleki P.A., et al.
Court considers whether DCF analysis could apply to professional practice that is no longer a going concern.
Yet Again, Delaware Looks to DCF in Appraisal Action
PNC Financial Services Group Inc. (PNC), the parent of PFPC Holding Corp. (Holding), had planned to take Holding’s subsidiary, PFPC Worldwide Inc. (PFPC), public via an initial public offering (IPO), but the opportunity did not arise.
Court Rejects DCF Approach Where Inputs Are 'Untethered to Reality'
In this appraisal action, the only valuation issue was the value of only one of the merged company’s assets.
Valuation Upheld Against Party That Fails to Use Independent Valuation Sources
Verizon Inc. had offered to buy MCHC’s majority holder, Palmer Wireless Holdings (Palmer), if Verizon’s initial public offering was successful and if Palmer could acquire 100% of the stock in all of the companies it held.
Control Premium Not Needed for DCF Analysis Using Gordon Growth Model
One of the issues was whether the board’s financial advisor, Credit Suisse First Boston (First Boston), correctly excluded a control premium in its assessment of the company’s value and, thus, whether the board failed to reasonably consider the value of all relevant alternatives.
Federal Court’s Declaring Valuation Date and Methodology Does Not Interfere With State Probate
The issue in this case was whether a federal district court could issue a declaratory judgment deciding the meaning of the agreement without interfering with state probate proceedings, and thereby negating federal subject matter jurisdiction.
Andaloro v. PFPC Worldwide, Inc.
PNC Financial Services Group, Inc. (PNC), the parent of PFPC Holding Corp. (Holding), had planned to take Holding's subsidiary, PFPC Worldwide, Inc. (PFPC), public via an initial public offering (IPO), but the opportunity did not arise.