Corporate Finance: Seeking a Legal Basis for the Valid Corporate Purpose Test in Going Private Mergers
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Authors
Seline, Steven W.
Issue Date
1979
Volume
12
Issue
Type
Journal Article
Language
Keywords
Alternative Title
Abstract
INTRODUCTION|The continuing phenomenon of going private mergers in response to downward swings in stock market prices has been the source of much comment, criticism and litigation. Until recently, it was thought that such mergers, which have the effect of eliminating the interest of minority shareholders, could be successfully challenged under federal securities laws. Where such mergers were effected without a valid corporate purpose, violations of federal securities regulations were found in a number of cases. However, in the landmark decision of Santa Fe Industries, Inc. v. Green, the United States Supreme Court sharply limited the thrust of lower court decisions by eliminating federal securities laws as a basis for application of the "valid corporate purpose" test to going private mergers...
Description
Citation
12 Creighton L. Rev. 629 (1978-1979)
Publisher
Creighton University School of Law