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to purchase up to 5.5 million shares of petitioner at $27.50 per
share in cash. The First HBC Offer was the first step in
implementing the Agreement in Principle. At or about the same
time, the Board concluded that the $24 per share offered by JMSL
was inadequate and not in the best interests of petitioner or its
stockholders. The Board's decision was partially based on a
written opinion (fairness opinion) that the Board received from
petitioner's investment banker, Lehman Brothers Kuhn Loeb, Inc.
The fairness opinion stated that: (1) The $24 price offered in
the Second JMSL Offer did not fully represent or reflect the
value of a control position in petitioner and (2) the
transactions contemplated by the Agreement in Principle,
including the First HBC Offer, were, taken as a whole, superior
to the Second JMSL Offer and the possible second-step merger
involving petitioner proposed by JMSL.
The First HBC Offer and the Second JMSL Offer spawned
extensive litigation among the interested parties. See, e.g.,
Pabst Brewing Co. v. Kalmanovitz, 551 F. Supp. 882 (D. Del.
1982); Jacobs v. G. Heileman Brewing Co., 551 F. Supp. 639
(D. Del. 1982). On November 17, 1982, the District Court
preliminarily enjoined JMSL, PST, the Jacobs Group, and
Kalmanovitz from consummating the Second JMSL Offer unless
additional disclosures were mailed by JMSL to petitioner's
shareholders. In response, JMSL mailed to petitioner's
shareholders an amendment to the Second JMSL Offer, dated
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