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The following is not meant to be legal advice.

On March 14, 2007, the Delaware Chancery Court issued an opinion in In re Netsmart Technologies, Inc., Shareholders Lit.  addressing matters that a board of directors should consider when selling the company to a private equity buyer.

The decision in In re Netsmart Technologies, Inc., Shareholders Lit. criticized the decision by the Netsmart Technologies, Inc. (Netsmart) board to not include potential strategic buyers when considering a sale of the company to private equity firms. For those not familiar with the lingo, strategic alternatives usually means that the company is looking to be bought or engage in a merger.  A private equity firm approached Netsmart with an interest in acquiring the company and taking it private. Then expression of interest from another private equity player came into play.  Netsmart provides enterprise software solutions to health and human-services organizations.