Delaware Chancery Applies MFW to Dismiss Challenge to Going Private Transaction

In a recent decision, Vice Chancellor Laster of the Delaware Court of Chancery clarified certain issues related to the obligations of a controlling stockholder that often arise in connection with going private and similar transactions.

The case involved a relatively conventional proposal by a controlling stockholder (the Anderson family) to acquire the remaining shares of Books-A-Million, Inc. (“BAM”) from BAM’s minority stockholders.  The family structured the proposal with the goal of satisfying the conditions of the MFWdecision so that any challenge to the transaction would benefit from the favorable “business judgment” level of judicial review. Click here, to continue reading on the Cleary M&A and Corporate Governance Watch blog.