Abramczyk, Cincilla & Honaker 2003), the sharp increase in tender offer incidence after June
2001 suggests that the combination of Siliconix and Glassman provided a clearer articulation of
the tender offer route than had previously existed.
This responsiveness to Delaware M&A case law is consistent with Coates & Subramanian
(2000), which presents evidence that practitioners changed the nature of deal protection devices
in response to certain Delaware deal protection decisions. Still, the finding on post-Siliconix
choice of transactional form is in tension with the common assumption in the academic literature
that practitioners have made frequent use of the Siliconix mechanism to avoid entire fairness
review, and with some practitioner claims that virtually all freeze-outs since Siliconix have been
executed via tender offer.35 I explore this point in Part 4.4 below.
Examining further the thirty-six deals that were initiated as tender offers, in only four
situations (all cases in which there were no independent directors) did the target not establish a
SC to assess the transaction, negotiate with the controller, and provide a recommendation to the
by Pritchard (2004) and
Abramczyk, Cincilla & Honaker (2003) that minority shareholders in a tender offer freeze-out
still (almost always) have a bargaining agent in the form of a special committee. The question
remains, however, whether the SC can bargain as effectively in the tender offer context as in a
35 For example, a partner at a major New York City law firm states: “I am not sure I can think of a going-private deal since Pure Resources [in August 2002] that has been done the old-fashioned way of negotiating a one-step merger agreement with a special committee of the target.” David Marcus, Cleaning Up Your Corporate Structure, CORPORATE CONTROL ALERT, at 20 (July 2003). In fact there have been 54 of these “old fashioned” deals since Pure Resources, and (as shown in Figure 2) 85 since Siliconix. Cf. Pure Resources, 808 A.2d at 443 (“The absence of convincing reasons for this disparity in treatment inspires the plaintiffs to urge me to apply the entire fairness standard of review to Unocal’s offer. Otherwise, they say, the important protections set forth in the Lynch line of cases will be rendered useless, as all controlling shareholders will simply choose to proceed to make subsidiary acquisitions by way of a tender offer and later short-form merger.”) (emphasis added).