Jim Hamilton has a detailed analysis of Chancellor Leo Strine's recent decision in the Synthes shareholder litigation:
In a wide-ranging opinion, the Delaware Chancery Court ruled that minority shareholders did not state facts supporting an inference that a controlling shareholder’s interest in obtaining liquidity in a sale of the company constituted a conflict of interest justifying the invocation of the entire fairness standard and supporting a non-exculpated duty of loyalty claim. The facts demonstrated that the controlling shareholder received equal treatment in the merger and that the business judgment rule applied to the decision of the board of directors to approve the merger. The facts did not support an inference that there was any breach of fiduciary duty on the part of the controlling stockholder or members of the board of directors. (In re Synthes, Inc. Shareholder Litigation, Del Chan Ct, Civil Action No. 6452, August 17, 2012)
In addition, the court held that Revlon duties did not apply where shareholders received mixed consideration of 65 percent stock and 35 percent cash for their stock.
The analysis continues at length. For my take on the case, which focuses on the Revlon aspects, go here.
