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Addressing appraisal rights for shareholders during mergers

On Behalf of | Dec 28, 2021 | Comprehensive Business Law, Mergers & Acquisitions

When two or more companies in New York or elsewhere are preparing to initiate a merger, all parties involved may be left in search of insight on how best to approach the situation. Business shareholders who are facing the possibility of losing shares during a merger or acquisition could find it helpful to consider invoking their shareholder appraisal rights. However, some might not fully understand what this process entails.

Appraisal rights

According to experts, shareholders may commonly seek to exercise their appraisal rights during business mergers or acquisitions, especially if they would have to give up their shares in the process. Should they feel that the amount that is being offered for their shares is less than what the shares are worth, taking steps to obtain the proper value through asset appraisal could prove imperative. As there are numerous types of valuation methods available, seeking insight on the available options may also play a vital role in preparing to choose the best path forward.

Experts also advise that there are additional scenarios in which shareholders might wish to invoke their appraisal rights. Some examples could involve a scenario in which a business is facing consolidation or if shareholders feel that the company has taken actions that do not align with their interests. While these rights exist to protect the interests of shareholders, knowing how or when to invoke such options can be a complex endeavor.

Protecting shareholder interests

Business shareholders who wish to know more about their appraisal rights may find it helpful to consult with an attorney for advice in making informed decisions about their situation. An attorney in New York can examine the circumstances a client is facing and provide insight on his or her available options and legal rights. Such guidance could prove integral to helping place a person in a better position in which to safeguard his or her business interests through the appropriate channels.


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