In connection with a sale of the company, the board of directors of the target faces the formidable task of discharging its fiduciary duties to its stockholders in a context in which the board’s actions are likely to be scrutinized in subsequent litigation. The following article provides guidance to target boards, and the lawyers who advise them, in the public M&A context on topics that the Delaware courts have recently considered.
Conflicts of Interest
In any M&A transaction, a target board must be mindful of conflicts of interest affecting directors, the chief executive officer, and the board’s financial adviser. The clearest conflict arises where one of these participants holds an ownership or other business interest in the acquiring entity or any of its affiliates.
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