Emily owns 92% of the outstanding stock of Blue Corp, a Dela…
Emily owns 92% of the outstanding stock of Blue Corp, a Delaware corporation that is closely held. The directors of Blue Corp. (all of whom have been selected by Emily) approve a statutory short-form merger of Blue Corp. into Rainbow, Inc., a corporation in which Emily owns 100% of the outstanding shares. Pete Prism, one of the Blue Corp. shareholders holds 1.3% of Blue Corp’s outstanding stock and wants to challenge the merger. As part of the merger, Pete will be paid $50/share for each of his shares in Blue Corp. However, the other documents disclosed to Pete clearly show that Blue Corp. should be valued at $300/share. Pete wishes to bring a claim against Blue Corp. and to receive a fair payment for his Blue Corp. shares. What type of claim, if any, has the greatest likelihood of success for Pete?