Faculty Notes

Prof. Ronald Colombo Quoted in Newsday on Breakup Fee in Danaher Deal to Acquire Pall

Pall Corp. would pay $423M breakup fee if Danaher deal falls through
By Ken Schachter
Newsday
May 15, 2015

Excerpt:

Ronald Colombo, a professor at Hofstra University’s School of Law and former counsel for Wall Street investment bank Morgan Stanley & Co., said that breakup fees frequently are included in such deals to protect the buyer’s investment in pursuing the acquisition.

“To go down this road is very expensive,” he said, and buyers like Danaher often request that a breakup fee be included in the agreement.

Colombo said that directors at Pall have to walk a fine line in negotiating a breakup fee: high enough to “cement” the bid by Danaher, but not too high to scare off other potential bidders.

“Once they decided to sell the company, they’re obliged to have a single-minded focus on maximizing the price for shareholders,” he said. “They have an obligation to sell to the highest credible bidder.”

While $423.2 million — about 3 percent of the total transaction — is at the “higher end” of such fees, “it is not unreasonable,” Colombo said.

Read the full article (subscription required).

Latest Tweets

  • Alumni Spotlight: Rick Collins ’84 https://t.co/xb5E2wGMsX
    about 22 hours ago
  • Alumni Spotlight: Mecca Sykes-Santana ’00 https://t.co/JpVJHDP47o
    about 23 hours ago
  • Prof. Julian Ku Quoted in The New York Times on New Development in US Trade War With China #HofstraExperts https://t.co/84auneOe0D
    about 4 days ago
  • Prof. Julian Ku Discusses Constitution’s Role in US Culture and Law on WSHU Public Radio https://t.co/6GEYrN4hVK
    about 4 days ago
  • Prof. James Sample Interviewed by Business Insider on Likelihood of Trump Impeachment https://t.co/RNQHIpRsqC
    about 4 days ago
  • Prof. Baruch Bush’s Article on Mediation Ethics Published in Ohio State Journal on Dispute Resolution https://t.co/5fL8YTg07V
    about 7 days ago

Archives