Bloomberg BNA’s Corporate Law & Accountability Report is available on the Corporate Law Resource Center. This news service keeps corporate practitioners informed of legal developments of...
June 20 — A court-appointed custodian can pursue a plan to sell TransPerfect Global Inc. through a “modified auction” led by the company's existing stockholders, the Delaware Chancery Court ruled June 20 ( In re TransPerfect Glob. Inc., 2016 BL 195972, Del. Ch., No. 9700-CB, 6/20/16 ).
According to the court's decision, the custodian's proposed plan to sell TransPerfect allows its two co-owners—Elizabeth Elting and Philip Shawe—to bid for control of the company alone or in partnership with outside investors. It also permits the custodian to work with outside bidders unaffiliated with the two stockholders, who each effectively control 50 percent of the company's stock.
Shawe opposed the modified auction, claiming that bidders should be limited, at least in the first instance, to Elting and himself.
However, Chancellor Andre Bouchard found that Shawe's plan, which potentially allowed third parties to bid in a second round, would reduce competition in the sale of the company, “contrary to the objective of maximizing stockholder value.”
The court rejected the custodian's recommendation to impose non-competition and non-solicitation obligations on the selling stockholders, saying they weren't appropriate absent evidence that either party engaged in wrongdoing.
In August 2015, Bouchard appointed the custodian to sell the profitable company (34 CARE, 8/21/15) (34 CARE, 8/21/15). In that ruling, Bouchard found the “unusual relief” was warranted because Elting and Shawe had become so deadlocked that they were harming the company.
The court's 2015 ruling sparked some backlash from employees of the translation services company, who are fighting to stop the sale (106 CARE, 6/2/16).
To contact the reporter on this story: Michael Greene in Washington at email@example.com
To contact the editor responsible for this story: Yin Wilczek at firstname.lastname@example.org
The opinion is available at http://www.bloomberglaw.com/public/document/In_re_TransPerfect_Glob_Inc_No_9700CB_Civil_Action_No_10449CB_201.
Copyright © 2016 The Bureau of National Affairs, Inc. All Rights Reserved.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)