Rabkin v. Philip A. Hunt Chemical Corporation
Delaware Supreme Court
498 A.2d 1099 (Del. 1985)
Olin Corp. (Olin) bought 63.4 percent of the outstanding shares of Philip A. Hunt Chemical Corporation (Hunt) (defendant) from Turner and Newall Industries, Inc. (Turner) for $25 a share. Olin’s purchase agreement with Turner required that if Olin acquired the remaining Hunt stock within one year, it would pay $25 per share for that stock as well. Olin had always intended to acquire the remaining Hunt stock, but did not act on that intention until right after one year had passed, thus avoiding the $25 per share requirement in the agreement with Turner. After the year had passed, Olin hired Morgan Lewis to render a fairness opinion on a purchase price of $20 per share. Morgan Lewis agreed that it was fair and Olin’s Finance Committee voted unanimously to propose a price of $20 per share for the remaining Hunt stock. Upon the merger proposal, the Hunt board appointed a committee to review its fairness. The committee’s advisor, Merrill Lynch, found that although $20 per share was fair, it was on the low end as the stock was worth somewhere between $19 to $25 per share. The committee recommended to Olin that it increase its offer, but Olin declined to act on the recommendation. The committee subsequently declared that $20 per share was fair and recommended approval of the merger. Rabkin, et al. (plaintiffs) brought suit challenging the merger. The plaintiffs claim that Olin manipulated the timing of its merger proposal to avoid the one year commitment price it had agreed to with Turner, thus costing the plaintiffs $4 per share. The Delaware Court of Chancery dismissed the plaintiffs’ claims, holding that absent fraud or deception, the plaintiffs’ only remedy was their appraisal right. The plaintiffs appealed.
Rule of Law
Holding and Reasoning (Moore, J.)
What to do next…
Unlock this case brief with a free (no-commitment) trial membership of Quimbee.
You’ll be in good company: Quimbee is one of the most widely used and trusted sites for law students, serving more than 97,000 law students since 2011. Some law schools—such as Yale, Vanderbilt, Berkeley, and the University of Illinois—even subscribe directly to Quimbee for all their law students. Read our student testimonials.
Learn more about Quimbee’s unique (and proven) approach to achieving great grades at law school.
Quimbee is a company hell-bent on one thing: helping you get an “A” in every course you take in law school, so you can graduate at the top of your class and get a high-paying law job. We’re not just a study aid for law students; we’re the study aid for law students. Read more about Quimbee.
Here's why 166,000 law students have relied on our case briefs:
- Written by law professors and practitioners, not other law students. 13,800 briefs, keyed to 187 casebooks. Top-notch customer support.
- The right amount of information, includes the facts, issues, rule of law, holding and reasoning, and any concurrences and dissents.
- Access in your classes, works on your mobile and tablet. Massive library of related video lessons and high quality multiple-choice questions.
- Easy to use, uniform format for every case brief. Written in plain English, not in legalese. Our briefs summarize and simplify; they don’t just repeat the court’s language.