The Court of Chancery held that the Revlon standard applies when a merger consideration is split evenly between cash and stock, but nonetheless declined to enjoin a merger between Smurfit Stone Container Corp. (“Smurfit”) and Rock-Tenn Co. Stockholders of Smurfit had contended that the price, the equivalent of roughly $35 per share, was unreasonable and that the Smurfit board had violated its Revlon duty to maximize shareholder value by failing to adequately value or shop the company, and by agreeing to preclusive deal protection measures, such as a $120 million termination fee. The Court refused to grant the preliminary injunction, holding that (1) there was not a “strong showing” of likelihood of success on the merits because the Board’s decision to sell the company was not unreasonable, (2) plaintiffs failed to establish irreparable harm, and (3) the balance of equities favored the defendants.
