The Long Rise and Quick Fall of Appraisal Arbitrage
55 Pages Posted: 2 Mar 2020
Date Written: February 28, 2020
Appraisal is a legislatively created right for shareholders to seek a judicial determination of the fair value of their stock in certain transactions. For many decades, appraisal was a little used, frequently maligned, corporate law remedy. Beginning at the turn of the 21st century, this all changed when a group of financial investors, including several hedge funds, began filing appraisal cases. Appraisal arbitrage, as it became known, grew rapidly in popularity.
Keywords: Delaware corporate law, shareholder litigation, appraisal arbitrage, Delaware appraisal amendments, mergers and acquisitions, appraisal, and valuation methods
JEL Classification: G23, K22
Suggested Citation: Suggested Citation