Gustav Schmidt, a shareholder with Gunster’s Securities practice, spoke with Colin O’Keefe of LXBN TV about the fairness review of the recent Facebook/Instagram deal.
That is, despite Facebook’s share price dropping 25 percent since the IPO, the Instagram purchase still passed a fairness review by the California Division of Corporations.
Here’s an excerpt from the interview:
“The fairness review process is actually part of a larger process, per se, in that every single sale or offer of securities has to be registered both at the federal and state levels,” Schmidt told LXBN TV.
“Now, one of the exemptions from that registration requirement — which is sometimes referred to as the 3(a)(10) exemption under the federal securities laws — allows a court or a designated governmental agency to review the terms of the transaction and basically make a determination as to whether or not it’s a fair deal for the shareholders who are receiving … in this case, the Facebook shares, from Facebook, in connection with the acquisition.”
Watch the complete video interview on The Securities Edge, a blog for middle market companies: Discussing the Facebook-Instagram deal’s fairness review.
