Shareholder Rights in the Crosshairs: Navigating Legal and Governance Risks in 2025's High-Profile M&A Deals

The 2025 M&A landscape has become a battleground for shareholder rights, with the proposed deals involving Olo (OLO), FuboTV (FUBO), Arcadia Biosciences (RKDA), and Norfolk Southern (NSC) sparking intense legal and governance debates. For long-term investors, these transactions offer a masterclass in the importance of transparency, board accountability, and risk assessment. Let's break down the key issues and what they mean for your portfolio.

The OLO Deal: Cash Offers and the Shadow of Undervaluation

Olo's $10.25-per-share cash acquisition by Thoma Bravo has drawn fire from investors and legal experts alike. While cash offers provide liquidity and certainty, the devil lies in the details: Is the price fair? Does it reflect Olo's long-term growth potential in the digital food ordering space?

Legal investigations are now probing whether Olo's board adequately justified the valuation. The key question here is whether the board provided a “fairness opinion” from independent advisors and whether all material risks—like integration costs or revenue volatility—were disclosed. For investors, this highlights a critical lesson: cash offers can be a double-edged sword. They eliminate uncertainty but may undervalue a company if the board's disclosures are incomplete.

FUBO and Disney: Control Shifts and Strategic Capture

FuboTV's proposed merger with Disney, which would hand the entertainment giant a 70% stake in the combined entity, raises red flags about governance. Disney's dominance could marginalize Fubo's independent vision, particularly in content licensing and streaming innovation.

The real risk here is strategic capture—a scenario where the acquiring company's interests override those of the target. Shareholders must scrutinize the new governance structure: Will Fubo retain board seats? Are there safeguards against overpaying for synergies that don't materialize? Legal experts are already questioning whether Fubo's board provided a robust fairness opinion. For investors, this deal underscores the importance of voting rights and board diversity in preserving long-term value.

RKDA's Lopsided Merger: Minority Shareholder Marginalization

Arcadia Biosciences' merger with Roosevelt Resources, which would see Roosevelt own 90% of the combined entity, is a textbook case of concentrated control. Such lopsided deals often leave minority shareholders vulnerable to poor governance practices.

Legal inquiries are now focused on whether Arcadia's management disclosed all potential conflicts of interest and liabilities tied to Roosevelt's stake. For example, does Roosevelt have any hidden obligations or environmental risks that could impact Arcadia's operations? Investors should also watch for mechanisms like poison pills or independent oversight that could protect minority stakes. This deal is a stark reminder: ownership concentration is a governance red flag.

NSC's Mixed Offer: Balancing Cash and Equity Risks

Norfolk Southern's mixed consideration deal—1.0 share of Union Pacific stock plus $88.82 in cash per NSC share—introduces a unique set of challenges. While the cash component offers immediate value, the equity portion ties shareholders to Union Pacific's future performance.

Legal analyses are now evaluating whether NSC's disclosures adequately explained the risks of the stock component, such as potential dilution or misalignment with NSC's historical returns. For investors in cyclical industries like rail, this deal highlights the need to assess not just the offer's structure but the acquiring company's long-term prospects.

The Bigger Picture: Legal Scrutiny as a Governance Barometer

The legal actions from firms like Monteverde & Associates and Halper Sadeh LLC are more than just litigation—they're a barometer for governance standards. These lawsuits can delay deals, renegotiate terms, or even scuttle transactions entirely. For investors, this means monitoring legal developments is as critical as analyzing financial metrics.

What Long-Term Investors Should Do

1. Demand Transparency: Scrutinize management disclosures for completeness and independence.
2. Monitor Legal Risks: Track ongoing investigations and shareholder lawsuits.
3. Diversify Exposure: Avoid overconcentration in deals with lopsided ownership or unclear synergies.
4. Compare to Peers: Use historical M&A data to assess whether the offer terms align with market trends.

Conclusion

The OLO, FUBO, RKDA, and NSC deals are not just about numbers—they're about power, control, and accountability. For long-term investors, the lesson is clear: governance matters. Shareholders who demand rigorous disclosures, board independence, and legal clarity will be better positioned to avoid traps and capitalize on opportunities in the volatile M&A landscape.

In the end, the best defense against fiduciary risks is a well-informed and vigilant investor. Stay sharp, ask hard questions, and remember: in M&A, the devil is always in the details.