2015 and 2016 mark the 30th anniversaries of the Delaware Supreme Court’s landmark decisions in Unocal Corp. v. Mesa Petroleum Co. and Revlon, Inc. v. Macandrews & Forbes Holdings, Inc. Those cases and their progeny called for enhanced scrutiny standards to be applied to negotiated change of control transactions as well as to deal protection devices. During the past three decades, however, it has not been smooth sailing in the courts’ application of these standards. In fact, I have previously argued that the Delaware courts have shifted away from both the Unocal and Revlon enhanced scrutiny standards.… Read more
Crown jewel lock-up options, a deal protection device common during the 1980s mergers and acquisitions boom, are back. My forthcoming paper, Fleecing the Family Jewels, is the first scholarly paper to examine the reemergence of crown jewel lock-ups in M&A transactions and to compare recent lock-ups to those used in the 1980s.
Crown jewel lock-ups became popular in the 1980s, a period which saw a significant number of hostile transactions. Lock-ups were defense du jour – employed to deter hostile bidders. These lock-ups took the form of agreements between a target company and a buyer pursuant to which … Read more