Here's an article saying the case he cited is not likely to be used going forward (among other comments), and is instead the decision is more specific to the case. If you register you can read it online for free, but no cut and paste.
jstor.org
Here's an article saying the M&A industry is basically ignoring the Conedison case, perhaps at their own peril!
alston.com
I'm sort of surprised that for such an important topic there is not more general information available online about this question.
I'm not sure why you're so certain that the Wells Fargo financing commitment ended.
The confirmation that the financing commitment ended with the deal termination is in the latest MXL 10Q, filed after the termination announcement.
It's possible the financing is not terminated if the tribunal says the cancellation was unlawful, but I don't know that. In either case, I would imagine it terminated with the Aug 7th date (but again, just guessing).
And why do you doubt that Singapore arbitration takes years?
Seems like a very simple case to me, with reasons to expedite. Did SIMO breach the agreement? I doubt it. Seems like MXL just made it all up. How many years can it take to determine that? MXL says their proof is in the undisputable record, so ....... it shouldn't take them long to present their case. It's all already out there for the world to see.
If the theory that shareholder damages DO NOT flow to the settlement, then this is quite a small case.
Yes, it depends on Cayman Islands law, but without any clear precedent from a Cayman Islands court, why would the Singapore tribunal decide to break new ground instead of following precedents from respected courts with similar legal systems to that of the Cayman Islands? Sure, it's possible, but why are you so confident that they will do so. Seems on the unlikely side, which is all the speaker said.
I think SIAC declaring that a buyer who willfully breaches a merger agreement DOES NOT in general owe shareholders lost stock value damages is a much more significant ruling than the obvious logical ruling (ie, the breaching buyer DOES owe damages).
Singapore desire to NOT establish new Cayman's case law would (I think) make them inclined to follow logical outcomes rather than the outlandish outcome from the case cited in the video. The implications of he Con Edison case are way more controversial than following the obvious intent - a willful breach results in damages, and damages are the deal value of SIMO minus the no deal value of SIMO.
I also assume the lawyers who make these M&A contracts know what they're doing, and I think this question is likely settled by now. Con edison was setted in 2006 I think. Commen sense says SIMO's lawyers (Latham Watkins) know this topic well, and have structured the deal appropriately.
But yes, it's just my hunch more than anything. I don't know it. |
