MERGERS AND ACQUISITIONS

Winter 2011
Professor Alicia Davis

Course Materials - The required materials for the course are the casebook (“CB”), Peter V. Letsou, Cases and
Materials on Corporate Mergers and Acquisitions (2006); selected Harvard Business School case studies (“HBS
Cases”); and course pack materials excerpted from Therese H. Maynard, Mergers and Acquisitions: Cases,
Materials and Problems (1st and 2nd eds., 2005 and 2009) (“MACMP”).

Assignments - An assignment sheet for the course is attached. Each numbered assignment roughly corresponds
to one class period, but certain units of assigned readings may take more than one class period to discuss.
Please note that assignments are subject to change.

HBS Cases - The HBS Cases are based on actual business and legal situations. Please do not do outside
research related to any of the HBS Cases before we discuss the cases in class.

Final Exam - The final exam is a four-hour, open book exam. The exam will consist of multiple choice and
essay questions. During the exam, you may refer to the course materials, your class notes, outlines that you
prepared yourself or participated in preparing and a foreign language (translating, non-legal) dictionary. You
also may use a calculator or spreadsheet program during the exam. No treatises, commercial outlines or other
outside materials may be used. At the conclusion of the exam, in addition to your answers, you must return the
exam booklet. A failure to return the exam booklet in its entirety will result in your final course grade being
dropped a full letter grade (e.g., from B+ to C+).

Group Simulation - You will be required to form groups and complete a simulation exercise. I will provide
details on the simulation later in the semester.

Class Participation - Class discussions are richest when as many of you as possible are prepared to participate.
However, I understand that a variety of circumstances may prevent you from preparing for class on any given
day. Therefore, if you are unprepared on a particular day, please email me by 9:30 AM on the day of class to let
me know you will be unable to participate in the upcoming class discussion. You are neither required nor
expected to give me a reason for your lack of preparation.

Being Prepared – Being prepared means you have completed all of the assigned reading, have made a good faith
attempt to understand the key issues, and are able to give a well thought-out and reasoned response to each
assigned discussion question. If you are not prepared for class, you should opt out of class discussion.

Attendance – Regular attendance is required. If you are unable to attend a class session, please email me in
advance to let me know you will not be present.

Distractions – You may not access or use the Internet, email, instant messaging, games and the like while class
is in session. Laptop computers may be used during class only for note taking.

Grading - Your course grade will be based on your performance on the final exam (85%) and the group
simulation project (15%). Additional points for consistently outstanding contributions to class discussions also
may be factored in to the final course grade.

CTools – Please check CTools regularly for assignment questions, class announcements and supplemental
materials of particular relevance to the course that I may post from time to time.

Office Hours/Questions - My office is 437HH. I will hold regular office hours from 1:30 PM – 3:30 PM on
Wednesdays. You also may contact me by phone (734-763-2221) or e-mail (alidavis@umich.edu) to schedule
an appointment outside this time. Substantive matters are best discussed in person, but if you have a question
about administrative matters, please feel free to email me.

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I. Introduction to M&A
Subject
Overview/The Time Warner
Merger: A Case Study
II. Mergers
Subject
Transactional Forms and
Voting/Appraisal Rights
Transactional Forms and
Voting/Appraisal Rights (cont.)
Appraisal Rights - Determining
Fair Value
Kohler Co.: A Case Study

Ignore all MBCA-related sub-questions.
ASSIGNMENTS
Assignmen Reading Assignment Cases/Case Studies/Problem Sets
t
1 CB: 1-14 Time Inc.’s Entry into the Entertainment Industry (A)
HBS Case: 9-293-117
Assignmen Reading Assignment Cases/Case Studies/Problem Sets
t
2 CB: 33-42; 52; 415-419
3 MACMP: 47-51; 77-81; 731-733 (to the extent ∗
Problem Set No. 1 (except Question B.2)
necessary to answer the questions in Problem
Set No. 5) Problem Set No. 2*
Problem Set No. 5*
4 HBS (Darden) Case: UV0112 (pp. 1-4; 7-9; 14- Methods of Valuation for Mergers and Acquisitions
20)
Kleinwort Benson Limited v. Silgan Corporation
CB: 441 (introduction to §4.3 only); 452-453
Gonsalves v. Straight Arrow Publishers, Inc.
(introduction to §4.3(B) only); 461-477
Cavalier Oil Corp. v. Harnett
5 HBS Case: 9-205-034 Kohler Co. (A)
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 III. Asset and Stock Acquisitions
Subject
Transactional Forms and
Voting Rights
Asset Sales – State Law
Considerations
IV. Federal Securities Laws and State Tender Offer Regulation
Subject
Federal Securities Laws
The Hewlett-Packard—
Compaq Merger: A Case Study
Federal Securities Laws
(cont.))/State Tender Offer
Regulation

Ignore all MBCA-related sub-questions.
Assignmen Reading Assignment Cases/Case Studies/Problem Sets
t
6 CB: 136-139; 165-168 ∗
Problem Set No. 3
MACMP: 59-61; 73-75 Problem Set No. 4*
7 CB: 139-148 Gimbel v. The Signal Companies, Inc.
Katz v. Bregman
Hollinger Inc. v. Hollinger International, Inc.
Assignmen Reading Assignment Cases/Case Studies/Problem Sets
t
8 MACMP: 247-253 (through first paragraph); Basic Incorporated v. Levinson
257-260
CB: skim 75-93; skim 109-114; 126-134
9 HBS Case: 9-104-048 Hewlett-Packard—Compaq: The Merger Decision
MACMP: 290; 302 (beginning with Note 2) –
306 (through the third paragraph)
10 MACMP: 361-365
CB: skim 183-188; skim 259-260; skim 261-
273; skim 276-279; skim 302-307; 371
(introduction to §3.3 only); 394-401
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The Acquisition of 11 HBS Cases: 9-298-006; 9-298-095 The Acquisition of Consolidated Rail Corporation (A)
Consolidated Rail Corporation:
The Acquisition of Consolidated Rail Corporation (B)
A Case Study
V. Tax, Accounting and Antitrust Considerations
Subject Assignmen Reading Assignment Cases/Case Studies/Problem Sets
t
Tax Considerations 12 MACMP: 699-703
Supplemental Tax Materials (available on
CTools)

The CoMark LBO: A Case 13 HBS Case: 9-202-090 Brazos Partners: The CoMark LBO
Study
Accounting and Antitrust 14 CB: 16-18
Considerations
Antitrust Materials (available on CTools)
VI. Fiduciary Duties Related to Takeover Defenses
Subject Assignmen Reading Assignment Cases/Case Studies/Problem Sets
t
American Cyanamid: A Case 15 HBS Cases: 9-898-120; 9-897-064 American Cyanamid (A) & (B) Combined
Study
American Cyanamid (C): Epilogue
Introduction to Takeover 16 CB: 491-493; 501-520 (through first paragraph)
Defenses
Legal Standards 17 CB: 522-523 (Introduction to §5.3 only); 536- Unocal Corporation v. Mesa Petroleum Co.
546; 557-576
Paramount Communications, Inc. v. Time Incorporated
Moore Corporation Limited v. Wallace Computer Services,
Inc.
Legal Standards (cont.) 18 CB: 576-585 Blasius Industries, Inc. v. Atlas Corporation
Mercier v. Inter-Tel, Inc. (available on CTools)
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Circon: A Case Study
VII. Fiduciary Duties in Sales of Control
Subject
Overview of Deal Protection
Devices/Director Duties
Director Duties (cont.)
Director Duties (cont.)
VIII. Freeze-Out Transactions
Subject
Introduction/Fiduciary Duties
19 HBS Cases: 9-801-403; 9-801-404; 9-801-405 Circon (A)
Circon (B)
Circon (C)
Assignmen Reading Assignment Cases/Case Studies/Problem Sets
t
20 CB: 611-613; skim 613-615; 615-617; skim The Company Sale Process (background reading)
617-618; 618-620; skim 620-622; 622-624; skim
624-625; 625-626; 646-655; 685-704 Revlon, Inc. v. MacAndrews & Forbes Holdings, Inc.
Paramount Communications, Inc. v. Time Incorporated
HBS Case: 9-206-108
Paramount Communications, Inc. v. QVC Network, Inc.
21 CB: 626-630; 713-725 Lyondell Chemical Co. v. Ryan (available on CTools)
Omnicare, Inc. v. NCS Healthcare, Inc.
22 In re: Netsmart Technologies, Inc. S’holders Litigation
(available on CTools)
The Upper Deck Co. v. The Topps Co., Inc. (available on
CTools)
In re: Lear Corp. S’holder Litigation (available on CTools)
Assignmen Reading Assignment Cases/Case Studies/Problem Sets
t
23 CB: 727-734 (through the introduction to §7.2 Weinberger v. UOP, Inc.
only); 769-798
Kahn v. Lynch Communication Systems, Inc. (1994)
Kahn v. Lynch Communication Systems, Inc. (1995)
6
Fiduciary Duties (cont.) 24 CB: 798-815 (through the second full Glassman v. Unocal Exploration Corporation
paragraph)
In re Pure Resources, Inc. Shareholders Litigation
In re CNX Gas Corporation Shareholders Litigation
(available on CTools)

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IX. M&A Agreements
Subject
Letter of Intent/Confidentiality
Agreement/The Merger
Agreement
The Merger Agreement (cont.)
X. Review
Assignmen Reading Assignment Cases/Case Studies/Problem Sets
t
25 MACMP: 275; 277 (first two paragraphs only);
282 (beginning with Section 2)-289; 307-325;
skim 847-849
Skim Sample Confidentiality Agreement
(available on CTools)
26 MACMP: 325-351; 353-360; skim 851-856 In re IBP, Inc. Shareholders Litigation