Everyone has been expecting lawsuits under federal securities laws to be filed by Bear Stearns investors. But perhaps more important is the Delaware lawsuit linked in Opening Bell today. The Delaware suit has been filed by investors seeking a higher price than JPMorgan Chase's bid of $10 per share. They've asked a Delaware judge to stop the deal. Gordon Smith, on the Conglomerate, argues that they probably won't win.
Larry Ribstein, at Ideoblog, agrees. "In my view, in both cases [that the plaintiffs are likely to rely upon] the essential issue should be whether the board exercised its fiduciary obligations to preserve shareholder value, which is what the shareholders as a whole wanted them to do. And in both cases it arguably did, because the deal protection move secured the only promising deal in sight – in Omnicare, the Genesis bid, and in Bear, the quintupling of the Morgan bid," he writes. Interestingly, this sheds new light on JP Morgan's decision to raise the bid: it may help it sail through Delaware courts more easily.
Bear Stearns Investors Challenge JPMorgan Share Deal [Bloomberg]
Posted by Anal_yst , Mar 26, 2008 9:44AM
Heres another legal beaut':
09:41 03/26 DJ UPDATE:Enron Reaches Agreement In Principle With Citigroup
Enron Creditors Recovery Corp. reached an agreement in principle with
Citigroup Inc. (C) to settle the MegaClaims litigation in the Enron bankruptcy
case, with Citi paying Enron $1.66 billion.
Enron said Citi will also waive indemnification claims and an additional
$249.4 million of claims against Enron.
The company said claim holders of the six Yosemite/CLN Trusts will be allowed
claims of $2.41 billion against Enron North America and ENE, and $28.6 million
against ENE.
Enron said the settlement will also release an additional $1.7 billion in cash
held in a disputed claims reserve to be distributed to creditors.
Separately, Citi said the agreement resolved the two largest remaining claims against Citi, with Citi denying any wrongdoing. Citi also said it reached a
separate settlement agreement resolving all disputes with the holders of Enron
credit-linked notes.
Citi said Enron will release all of its claims against Citi and certain other
parties and will allow specified Citi-related claims in the bankruptcy
proceeding.
Posted by guest , Mar 26, 2008 10:44AM
Injunction or not, the merger is going down.
We now have access to Bear's address book from JPM's intranet homepage.
Posted by guest , Mar 26, 2008 1:22PM
I live in Delaware, and our Chancery Court is a Court of Equity. It is unlike any other. The judges are called Chancellors, and their decisions are not based on the winner & loser concept but rather on the basis of a just and equitable resolution between or among the positions of the opposing corporate litigants. In other words, the litigants don't get all that they want, but they do get clarity.