Here is a first-class analysis by Prof. Gordon Smith on his Conglomerate blog about whether the board of The Wall Street Journal can "just say no" to the recent unsolicited offer by Rupert Murdoch to buy the paper, based on key Delaware cases discussing the Revlon duties and related issues, especially where, as here, over 50% of the voting shares oppose the buyout. Here is a quote in the post from a Delaware Supreme Court decision:

Mills Acquisition Co. v. Macmillan, Inc. (May 3, 1989):

Clearly not every offer or transaction affecting the corporate structure invokes the Revlon duties.   A refusal to entertain offers may comport with a valid exercise of business judgment. Circumstances may dictate that an offer be rebuffed, given the nature and timing of the offer; its legality, feasibility and effect on the corporation and the stockholders; the alternatives available and their effect on the various constituencies, particularly the stockholders; the company’s long-term strategic plans; and any special factors bearing on stockholder and public interests.

He closes with this mind-stretching question from a blog post by Prof. Elizabeth Nowicki:

What happens if the water starts churning with hungry bidders?  At what point does the Board need to say to the 52% block "you are walking away from a super deal"?  Does the Board ever need to say that?  What about the minority s/h?  Who, if anyone, needs to advocate for them?

UPDATE: Prof. Bainbridge adds to the scholarly discussion here. He starts his analysis with Chancellor William Allen’s opinion in Mendel v. Carroll, 651 A.2d 297 (Del. Ch. 1994), and concludes as follows:

As applied to Dow Jones, I read Mendel as suggesting the following:

  1. In general, the fact that Dow Jones’ board is independent will take on great importance.
  2. A majority shareholder (or a controlling block of shareholders) has no duty to sell if it doesn’t wish to do so. Allen makes clear that self-sacrifice is not required. There is no obligation to sell.
  3. There would be no obligation to sell even if Nowicki’s anticipated other bidders start churning the waters. The Bancrofts can still just say no.
  4. Absent very unusual circumstances involving some sort of serious overreaching by the majority, a board may not act to undermine the majority’s control (as by making a dilutive stock issuance).
  5. So long as the family remains unwilling to sell, the Board has no Revlon duties.
  6. Once the family agrees to sell (or enough family members defect such that the anti-sale family members no longer have control), the Board may have Revlon duties. (Maybe.)