Product Description
Abstract
In 2011, El Paso — publicly traded oil and gas company — agreed to be bought out by Kinder Morgan, a leading owner/operator of US oil and gas pipelines. El Paso was advised by Goldman Sachs, which also owned 19% of Kinder Morgan. Despite taking steps to try to address the conflict of interest it faced, Goldman Sachs (and the board of El Paso) were strongly criticized by the Delaware Chancellor in an opinion that reverberated on Wall Street and beyond.
(A separate set of cases, In a Pickle: Barclays Capital and the Sale of Del Monte Foods and Barclays Capital and the Sale of Del Monte Foods, explore closely related issues arising in the context of the 2010 buyout of Del Monte, which was advised by Barclays Capital.)
Learning Objectives
To explore the consequences of legal review of public company buyouts, the legal duties of investment banks to their clients, and the potential conflicts of interest faced by boards, managers, and investment banks in such transactions, and to understand how shareholder litigation can affect the reputations of non-party professionals as much or even more than those of the board members being sued.
Subjects Covered
Mergers & Acquisitions, Shareholder Lawsuits, Conflicts of Interest, Corporate and Securities Law, Ethics
Setting
Geographic: United States
Industry: Natural Resources
Event Year Begin: 2011
Accessibility
To obtain accessible versions of our products for use by those with disabilities, please contact the HLS Case Studies Program at hlscasestudies@law.harvard.edu or +1-617-496-1316.
Educator Materials
Watermarked educator copies of this product are available free of charge to educators and trainers. Please create an account or sign in to gain access to these materials.
Note: It can take up to three business days after you create an account to verify educator access. Verification will be confirmed via email.
Additional Information
Conversation Starters: Case Studies for Curricular Reform
Copyright Information
Please note that each purchase of this product entitles the purchaser to one download and use. If you need multiple copies, please purchase the number of copies you need. For more information, see Copying Your Case Study.
