Silver Lake has asked Delaware’s Court of Chancery to prevent Carl Icahn and several investment funds from pursuing appraisal-related claims arising from its $13 billion acquisition of Endeavor.
The complaint targets a strategy in which investors buy shares after a deal is announced and seek a judicial valuation rather than accept the merger price. Delaware law permits eligible stockholders who follow strict procedural rules to ask the court to determine fair value. Silver Lake argues that the defendants coordinated their purchases and demands in a manner that misuses that remedy and could expose the buyer to hundreds of millions of dollars in additional payments.
Icahn did not file the appraisal petition described in the new suit, but he has brought a separate class action alleging fiduciary breaches in the transaction. The new complaint alleges coordination between him and funds that did seek appraisal, and challenges whether all required disclosures were made.
No court has yet decided the merits. The litigation arrives after Delaware narrowed parts of its fiduciary-duty framework, making appraisal an increasingly important route for investors who dispute the economics of a take-private deal. The case will test how far buyers can go in attacking the organization and financing of those claims.
