In the recent opinion of In re Appraisal of Dell Inc., C.A. No. 9322-VCL (Del. Ch. May 11, 2016), the Delaware Court of Chancery issued an opinion finding that certain record holders of Dell Inc. stock were barred from seeking appraisal of their shares as a result of inadvertently voting in favor of the Dell going-private merger. As a result, such shareholders failed to adhere to the “dissenting stockholder” requirement of 8 Del. C. Section 262.
In the opinion, the court considered appraisal demands of mutual funds sponsored by T. Rowe Price & Associates Inc. and institutions that relied upon T. Rowe to direct the voting of their shares. The T. Rowe petitioners held their shares through custodial banks, who in turn held the shares in the name of its nominee, Cede & Co., the record holder. Although T. Rowe publicly opposed the merger, its voting system generated instructions for Cede to vote the T. Rowe petitioners’ shares in favor of the merger.
Because petitioners’ shares voted in favor of the merger, the court dismissed the appraisal claim of the T. Rowe petitioners, and they will receive the merger consideration without interest.