AQR Capital Management is challenging the valuation behind the $8.4bn take-private of Clearwater Analytics Holdings, adding to a growing push by hedge funds to use Delaware’s appraisal process to seek higher payouts from completed M&A deals, according to a report by Bloomberg.
AQR filed a petition in Delaware’s Court of Chancery seeking a judicial determination of the value of Clearwater shares following the completion of the transaction in June. Shareholders received $24.55 a share when the deal, led by Permira and Warburg Pincus, closed.
The hedge fund manager said in the filing that funds it manages held about 3.3 million Clearwater shares, worth approximately $81.3m based on the deal consideration. AQR manages around $242bn in assets.
The firm argues that shortcomings in both the sale process and the transaction price meant Clearwater shareholders did not receive fair value. Its lawyers have alleged that conflicts surrounding the deal prevented the company from maximising value for unaffiliated public investors.
The case highlights the renewed interest among alternative asset managers in appraisal arbitrage — a strategy in which investors acquire shares of a company after an acquisition has been announced and subsequently ask a court to determine whether the agreed deal price represented fair value.
If the court determines that the stock was worth more than the price paid in the takeover, investors pursuing the appraisal claim can potentially receive the difference, along with applicable interest.
The strategy has attracted greater attention following changes to Delaware corporate law, which have altered the framework governing appraisal claims and deal litigation.
AQR has become an increasingly active participant in the strategy. Since last year, it has challenged the consideration paid in four separate transactions, according to Delaware court records.
Those cases include Silver Lake’s $25bn acquisition of Endeavor Group Holdings and 3G Capital’s $9.4bn purchase of Skechers USA. AQR is also challenging the $3.9bn acquisition of hospital operator Select Medical Holdings by a consortium co-led by Welsh Carson Anderson & Stowe.
The Clearwater position appears to have been accumulated primarily after the takeover was announced. Bloomberg data shows AQR bought most of its shares during the fourth quarter of 2025 and the first quarter of 2026.
The acquisition was announced in December 2025, with Permira and Warburg Pincus agreeing to take Clearwater private alongside Francisco Partners and with participation from Temasek.
AQR alleges that the transaction was affected by significant conflicts of interest and that the resulting price was unfair.
Clearwater has previously said the acquisition was approved by independent directors and a majority of shareholders without an interest in the transaction.
The company also described the sale process as comprehensive and said the $24.55 per-share consideration represented a premium of roughly 47% to Clearwater’s share price before reports of a potential transaction emerged.
AQR, Permira and Warburg Pincus reportedly declined to comment on the latest court filing, while Clearwater did not respond to requests for comment.
