M&A Delaware Update: Material Adverse Effect Post-Akorn, Standard of Deal Review, Appraisal Rights, D&O Fiduciary Duties

Description

The Delaware courts issued several significant rulings in 2018 and 2019 addressing essential issues for M&A practice. Recent decisions continue to clarify the appropriate standard of review in M&A transactions in the wake of Corwin v. KKR Financial Holdings L.L.C.

Appraisal rights actions and D&O fiduciary duties also continue to be the subject of Delaware decisions. In the Aruba case, the Delaware Supreme Court clarified the extent to which the court of chancery may rely on stock trading prices when determining fair value in an appraisal action. In Marchand v. Barnhill, the Delaware Supreme Court reversed the court of chancery's dismissal of a fiduciary duty claim, providing guidance on the role of the board of directors in overseeing risk management.

In a first-of-its-kind decision, the Delaware Chancery Court ruled that Fresenius Kabi AG was not required to close its $4.3 billion merger agreement with Akorn Inc. because Akorn suffered a material adverse effect. The Delaware Supreme Court affirmed the ruling in December 2018. Other significant decisions include the Delaware Supreme Court's finding of a breach of fiduciary duty by an activist investor, and the chancery court's strict enforcement of an "end date" provision in a merger agreement.

Listen as our panel of experienced M&A attorneys reviews critical Delaware court decisions issued during 2018 and 2019 and their impact on M&A practice. The panel will explain legal and practical implications for deal counsel negotiating and litigating deals in 2020 and beyond.