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Cross-Border Deals Demand a Tailored Approach

by Steven Anderson Counsel to Counsel Magazine When in Rome, draft contracts as the Romans do. The same goes for China, Brazil and most other countries. Cross-border deals require a customized approach. A one-size-fits-all mentality is a sure way to derail M&A or joint venture transactions...

Cash on the Balance Sheet

This morning's WSJ has an article suggesting that goods times are just around the corner for M&A lawyers. Actually, it's an article about the hole that is presently being burned in the pockets of managers as they sit on increasingly large cash-piles. The 382 nonfinancial firms in the Standard...

Astellas Launches Proxy Battle

You'll remember that Astellas made a hostile offer for OSI Pharmaceuticals earlier in the month. Along with their offer, they sued in Delaware to get the OSI board to consider the offer. Well, the board has considered the offer ($52/sh cash, a 40% premium) and has rejected it . Here's part...

Federal Agencies Announce Revised Horizontal Merger Guidelines

On April 20, 2010, the Federal Trade Commission ("FTC") and the Department of Justice ("DOJ") (collectively the "Agencies") released a proposed updated version of the Horizontal Merger Guidelines ("Guidelines"). The Guidelines are a set of internal rules that...

Unscrambling Eggs

It doesn't happen often. But, that doesn't mean it doesn't happen. The FTC is now suing Dun & Bradstreet (H/T Main Justice ) to unwind a transaction D&B closed last year. According to the complaint , D&B acquired the Quality Education Data (QED), a division of Scholastic, Inc...

Why 102(b)(7) Matters

I wanted to follow up on an earlier post, Triggering Revlon with Nonconvertible Debt . In the last paragraph of that post I noted that Lyondell reminds us that good faith claims are very hard to win. Stefan Padfield ( Business Law Prof Blog ) wrote me to remind me that the presence of an optional 102...

Chancery Issues Preliminary Injunction to Enjoin Transaction Due to Lack of Adequate Disclosure in Proxy Statement

Maric Capital Master Fund, Ltd. v. PLATO Learning, Inc., C.A. No. 5402-VCS (Del. Ch. May 13, 2010), read opinion here . Issue Addressed Whether a proposed merger should be enjoined due to the breach of the disclosure duty in connection with the proxy statement. Holding Although the Court...

Losing Standing after a Merger

In the vein of life mimicking possible exam questions - Morris James points out a recent case in the Delaware Chancery Court, Arkansas Teacher Retirement System v Caiaf a ("TRS") . The issue relates to whether a plaintiff may maintain standing in a derivative suit following a merger. The answer...

The Coming Merger Wave?

A couple of people have (independently) asked me recently whether or not I thought the recent build-up in cash on corporate balance sheets suggested that a new merger wave is around the corner? Sadly, I think not. We've had a number of "merger waves" in our history - late 1890s,...

Private and Public Merger Waves

Maksimovic et al have recently posted a paper, Private and Public Merger Waves , analyzing merger waves. It's not all that surprising that they find public companies are more likely going to be involved in cyclical merger waves than private companies. They suggest that access to capital is the determining...

Chancery Provides "Teachable Moment" for M & A Lawyers: Find Problems of Bidder in Due Diligence or Put Specific Reps in APA; Otherwise No Fraud Claim

Airborne Health, Inc. v. Squid Soap, L.P., C.A. No. 4410-VCL (Del. Ch. July 20, 2010), read opinion here . Prior Delaware Court of Chancery decisions in this case were highlighted here. Overview This case involves a claim against the purchaser of a company and its major law firm for fraud...

Chancery Rejects Request to Enjoin Hertz Takeover of Car Rental Rival Dollar Thrifty

In Re Dollar Thrifty Shareholder Litigation, C.A. No. 5458 (Del. Ch., Sept. 8, 2010), read 84-page opinion here . The Court of Chancery issued this opinion last night, denying the request for a preliminary injunction to block the merger by which Hertz would buy the shares of its smaller car rental...

Perfection of Delaware Appraisal Rights

The following is a general summary of § 262 of the DGCL. The rights and obligations of stockholders and companies will vary depending upon the circumstances of the particular merger. The appraisal process under § 262 of the DGCL, however, generally proceeds as follows. A company must...

The FCPA and Mergers and Acquisitions

In a webinar on December 2, 2010, Michael Volkov, partner in the law firm of Mayer Brown and Ryan Morgan, Sales and Alliance Director of World Compliance, discussed the implications of the Foreign Corrupt Practices Act (FCPA) to mergers and acquisition. They advise that businesses which seek to...

Merger May Give Investors Alternative to ISS Ratings

There's a three-letter acronym that stands for a company that focuses on corporate governance ratings and research that public companies and their boards should become familiar with in the next year. (No. I'm not talking about the powerful ISS.) It's GMI, as in GovernanceMetrics International...

NBC-Comcast Deal Approved

The FCC granted approval for the NBC-Comcast transaction yesterday. The deal was announced last Spring and has been pending approval since then. You'll remember that because the NBC-Comcast deal involves broadcast and cable properties, it required the approval of the FCC in addition to the normal...

J. Crew Settlement in Trouble

In the most cynical view of the shareholder lawsuit, managers are happy to settle even spurious claims because the global release and settlement generates effectively a 'get out of jail free' card absolving them of any fiduciary failings that may have come before the settlement. That's...

M&A Law Prof: AOL's Acquisition of the Huffington Post

While we await the Airgas decision, Steve Pearlstein (who I had the pleasure of meeting once in Saigon) has some thoughts in the Washington Post on the AOL-HuffPost merger. He thinks its the AOL-TimeWarner deal all over again: AOL looking for a route away from dial-up access and into contet. This...

Applying Morrison, Court Rejects Toyota Shareholders' Japanese Law Securities Claims

The U.S. Supreme Court's June 2010 decision in Morrison v. National Australia Bank looked like the end of securities claims in U.S. courts on behalf so-called "f-cubed" claimants - that is, foreign shareholders of foreign-domiciled companies who bought their shares on foreign exchanges...

Katherine Blair and Shoshannah Katz of K&L Gates Discuss Securities Issues in Acquisitions Involving Private Companies

On this edition, Katherine Blair and Shoshannah Katz of K&L Gates' Los Angeles office discuss securities issues that arise in merger and acquisition activity among privately held and non-reporting companies. They talk about notes as a form of security, assessing accreditation of investors, and...

M&A Remains in Doldrums

The New York Times reports today that the first half of 2012 has been pretty dismal in mergers and acquisitions. Total dollar volume is down almost 22% from the same period last year, and the number of deals is down 17%. Oil and gas was the busiest sector but was also down 5% from last year. Financial...

SEC Releases M&A Brokers from Registration

In a stunning reversal from over a decade of ruling differently, last Friday the SEC released a “no-action” letter saying it will not go after intermediaries in merger & acquisition transactions for failure to register as a broker-dealer even if they receive a commission equal to a percentage...

SEC Provides Exemption from Broker-Dealer Registration Requirements for M&A Brokers

On January 31, 2014 (revised February 4, 2014), the SEC issued a no-action letter to a group of attorneys who requested assurance on an issue that has long been on the minds of securities lawyers: are people who facilitate the sale of a controlling interest in a business involving a transfer of stock...

Most M&A Deals Result In Litigation That Ends By Closing

M&A deals are a focus of the private securities litigation bar, according to a new report from Cornerstone Research. Specifically, 94% or more of M&A deals filed last year with a value of over $100 million resulted in private damage actions, according to the report. Cornerstone Research, Shareholder...

Wells Fargo Compliance Officer Charged With Altering Document

The acquisition of Burger King by 3G Capital Partners is the matter that just keeps on giving – at least for SEC enforcement. Initially, the Commission brought an action against Wells Fargo broker Waldyr Da Silva Prado Neto, who misappropriated inside information about the transaction from a client...