Also known as: pro forma · proforma data · pro-forma data · pro forma financials · hypothetical data
Written by attorneys · grounded in primary & secondary sources — see below
Speculative projections of future value arising from the expectation or accomplishment of a merger. Such projections are excluded from the determination of fair value in appraisal proceedings.
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In a cash-out merger of TechCorp, the dissenting shareholders seek appraisal. The court refuses to consider the company's internal projections of post-merger synergies and cost savings, because those figures constitute pro forma data tied to the merger itself.
Pioneer Energy's board approves a merger with a competitor. When shareholders exercise appraisal rights, the valuation expert includes only historical earnings and market data. The court excludes the pro forma forecasts of combined operations as too speculative and merger-dependent.
Pro forma data and projections of a speculative variety relating to the completion of the merger are excluded. Elements of future value that are known or susceptible of proof as of the date of the merger and not the product of speculation may be considered.