Section 253 of the DGCL authorizes a “short form merger” between a corporation and a subsidiary if the parent corporation owns at least 90 percent of the stock of the subsidiary. To effectuate the merger, the parent simply has to file a certificate setting forth its stock ownership and the terms of the merger, which the board of directors of the parent corporation can set. No action is required of either the board of directors or the shareholders of the subsidiary. However, the parent corporation must inform the shareholders of the subsidiary of the terms of the merger and advise them that they are entitled to seek appraisal if they are dissatisfied with the consideration offered by the parent. Because a short form merger, by definition, involves self-dealing by a parent corporation, attorneys and commentators generally have assumed that the parent corporation also bears the burden of proving that the terms of the merger are entirely fair.

 In 1991, Unocal Corporation (“Unocal”) decided to eliminate the public shareholders of its 96%-owned subsidiary Unocal Exploration Corporation (“UXC”). To ensure that the proposed merger was entirely fair, the boards of Unocal and UXC appointed a special committee of the UXC board to negotiate on behalf of UXC’s public shareholders. The committee retained financial and legal advisers, met several times, and eventually agreed that an exchange ratio of 0.54 share of Unocal stock for each share of UXC stock was fair. Unocal then announced its intent to effect a short-form merger on those terms.

 A class action was filed on behalf of all UXC public shareholders the same day, alleging that Unocal had breached its duties of entire fairness and full disclosure. After discovery and a two-day trial, the Court of Chancery rejected both of plaintiffs’ claims. It held that Unocal had made full disclosure and that plaintiffs’ exclusive remedy was appraisal because the entire fairness standard does not apply to short-form mergers.

 Glassman v. Unocal Exploration Corporation, 777 A.2d 242 Del. (2001), affirmed. The Delaware Supreme Court, after reviewing the facts and the evolution of Delaware law governing parent-subsidiary mergers, stated:

 Mindful of this history, we must decide whether a minority stockholder may challenge a short-form merger by seeking equitable relief through an entire fairness claim.  Under settled principles, a parent corporation and its directors undertaking a short-form merger are self-dealing fiduciaries who should be required to establish entire fairness, including fair dealing and fair price.  The problem is that § 253 authorizes a summary procedure that is inconsistent with any reasonable notion of fair dealing.  In a short-form merger, there is no agreement of merger negotiated by two companies;  there is only a unilateral act--a decision by the parent company that its 90% owned subsidiary shall no longer exist as a separate entity.  The minority stockholders receive no advance notice of the merger;  their directors do not consider or approve it;  and there is no vote.  Those who object are given the right to obtain fair value for their shares through appraisal.

 The equitable claim plainly conflicts with the statute.  If a corporate fiduciary follows the truncated process authorized by § 253, it will not be able to establish the fair dealing prong of entire fairness.  If, instead, the corporate fiduciary sets up negotiating committees, hires independent financial and legal experts, etc., then it will have lost the very benefit provided by the statute--a simple, fast and inexpensive process for accomplishing a merger.  We resolve this conflict by giving effect the intent of the General Assembly.  In order to serve its purpose, § 253 must be construed to obviate the requirement to establish entire fairness.

 Thus, we again return to Stauffer, and hold that, absent fraud or illegality, appraisal is the exclusive remedy available to a minority stockholder who objects to a short-form merger.  In doing so, we also reaffirm Weinberger’s statements about the scope of appraisal.  The determination of fair value must be based on all relevant factors, including damages and elements of future value, where appropriate.  So, for example, if the merger was timed to take advantage of a depressed market, or a low point in the company’s cyclical earnings, or to precede an anticipated positive development, the appraised value may be adjusted to account for those factors.  We recognize that these are the types of issues frequently raised in entire fairness claims, and we have held that claims for unfair dealing cannot be litigated in an appraisal. But * * * [t]hose decisions should not be read to restrict the elements of value that properly may be considered in an appraisal.

 Although fiduciaries are not required to establish entire fairness in a short-form merger, the duty of full disclosure remains, in the context of this request for stockholder action.  Where the only choice for the minority stockholders is whether to accept the merger consideration or seek appraisal, they must be given all the factual information that is material to that decision. [We affirm the Court of Chancery’s conclusion that they received such information.] * * *

Id. at 247-248.