Private equity giant Silver Lake has sued billionaire Carl Icahn and dozens of hedge funds in an attempt to block them from using an obscure legal tactic to squeeze a bigger payday out of its $13 billion acquisition of the Endeavor entertainment agency.
Silver Lake Technology Management filed the lawsuit in Delaware's Court of Chancery on September 21, 2026, seeking a ruling that the hedge funds cannot pursue 'appraisal' claims for Endeavor stock they bought after Silver Lake announced in 2024 that it would take the company private for $13 billion, or $27.50 per share. Delaware corporate law allows investors unhappy with a merger to sue over allegations the deal was underpriced — a proceeding known as an appraisal action — and Silver Lake says the defendants are twisting that system for profit.
Endeavor became a particularly attractive target for a specialized investment strategy known as appraisal arbitrage. The company owned a majority stake in TKO Group Holdings, whose assets include World Wrestling Entertainment and the Ultimate Fighting Championship. After the Endeavor deal was announced, TKO stock rose sharply, and appraisal-focused hedge funds began scooping up Endeavor stock — in some cases even chasing it above the deal price, according to the lawsuit.
Silver Lake's complaint minces no words about the strategy: 'They are not dissenters; they are opportunistic arbitrageurs.' The firm argues the hedge funds are using appraisal litigation for financial arbitrage rather than genuine dissent, and accuses Icahn of coordinating stock purchases alongside improper securities disclosures. A favorable ruling for the funds could force Silver Lake to pay out hundreds of millions of dollars or more on top of the deal price.
Unlike a class action, an appraisal lawsuit only concerns the plaintiff investors' own stock. After considering each side's valuation evidence, a judge determines the stock's fair value — which can come in above or below the deal price. Despite Silver Lake's argument, Delaware's Court of Chancery has previously held that investors who purchased shares after a deal announcement still have a right to bring an appraisal case, setting up a consequential legal test.
Icahn had already been a thorn in Silver Lake's side: he previously filed a separate class-action lawsuit alleging fiduciary duty breaches and insider asset shifting around the deal. An attorney for the hedge funds declined to comment on the new suit. Industry analysts say the dispute highlights rising tensions over appraisal arbitrage tactics in major private-equity takeovers, as state corporate-law reforms have narrowed traditional fiduciary litigation and pushed dissident investors toward the appraisal route.