You're getting a few things mixed up. > '...but to rule that you should offer more than the market was valuing it?' Acquisitions in general are almost always

You're getting a few things mixed up. > '...but to rule that you should offer more than the market was valuing it?' Acquisitions in general are almost always for a premium based on the current market value of the company. Just look at Salesforce/Demandware this morning, with the stock up >50% over where it closed yesterday. As the article states, the current shareholders of the company obviously believe that the company is worth more than the current price - if they didn't, they would have sold their shares. The argument is regarding how much more it was worth, but the practice of it being worth more than it was at the time trading publicly when it comes to a buyout, take-private or acquisition is not in and of itself unusual. > Even though no one was actually willing to pay that price? 'Nobody' is sort of subjective here. No, nobody that was involved in the take-out process was willing to pay that price. But the lawsuit was brought by shareholders, who very well could have believed that the stock was worth $50, yet had positions as large as they could manage. The judge actually ruled that his price was correct because nobody (in the sales process) would be willing to pay that amount as private equity would need a significant return on its capital (25% in this case). > Isn't the whole point of a buyout that you think other investor's are incorrectly valuing a venture based on the available information? If any buyout is going to be subject to this later, with-more-hindsight review that forces buyers to "top up" to the "correct" value, what's the point? The Dell case is unusual because Michael Dell did not make the case for any sort of managerial or strategic shift post-buyout (hell, why would he push for a managerial change as the CEO). Normally in the acquisition/buyout/merger/etc process, there's something materiel that the acquirer wants to change to make the company more valuable. Maybe they want to purchase the company and get rid of all the managers. Maybe they want to purchase the company and achieve cost "synergies" between two or more companies where significant savings could boost sales. Maybe they want to let both companies sell each others products. In this case, Michael Dell didn't want to do anything different from what the current plan for the company had been -- he just wanted to do it in private. So while this decision is wild, it's not one that sets precedents for most acquisitions.