The Board adopted the Rights Plan to deter any entity, person or group from gaining control of the Company through the open market or private transactions without paying an appropriate control premium
or offering fair and adequate value to all stockholders.
Historically, private asset valuations come at discounts as compensation for the illiquidity assumed (offset somewhat by a control premium
The Board believes that it is in the best interests of all stockholders to guard against efforts to obtain control of GCP without paying all stockholders a control premium
, especially as the Board continues the process of evaluating strategic alternatives," says GCP Chairman Ronald Cambre.
Further, these data contribute a relatively small control premium
. Since the largest component of the yield rate buildup is the subject entity's current asset-level yield (IRR) at the date of value, current conditions (risk, growth and leverage and others) are already well represented at the asset level (see the case example, below).
for virtually no control premium
and entrenching themselves with board and executive positions with the new entity post-closing; disclosing for the first time the existence of a deal-restrictive crown-jewel lock-up right in favor of Fuji under joint venture agreements with Fuji and that such lock-up curtailed Xeroxs ability to pursue strategic alternatives with any entity other than Fuji; and disclosing for the first time that, in connection with Xeroxs change of control transaction with Fuji, defendant agreed to make Fujis crown jewel lock-up rights permanent going forward.
The fair value assigned to an acquiree takes into account goodwill (ASC 805-50-30-11), but the guidance does not make any direct reference to control premium
. Companies can take the position that the premium is not part of goodwill and not relevant to an acquiree (ASC 805-20-30-8).
CLAIM #3: Xerox shareholders will become passive minority owners,with no opportunity to receive a control premium
ExistingAlstomshareholders will be paid two special dividends: a control premium
of 4 euros per share to be paid shortly after closing of the transaction and an extraordinary dividend of up to 4 euros per share to be paid out of the proceeds ofAlstom's put options for its General Electric joint venture, "subject to the cash position ofAlstom".
Issue which is a matter under a debate and aroused much controversy in valuation is the impact of control premium
(minority shares discount) on the value of blocks of shares.
Airlines can control Premium
Economy seating much in the same way they control exit seats or seats in the first row.