Appraisal Arbitrage May Be A Hedge Fund Strategy

Law360 (June 7, 2007, 12:00 AM EDT) -- A recent Delaware case involving the acquisition of Transkaryotic Therapies Inc. by Shire Pharmaceuticals Group plc has the potential to revolutionize the use of appraisal rights in cash mergers involving Delaware target companies.

The opinion holds that investors that buy target company shares after the record date may assert appraisal rights so long as the aggregate number of shares for which appraisal is being sought is less than the aggregate number of shares that either voted no on the merger or didn’t vote on the merger....
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