Ronald O. Perelman, chairman of the board and CEO of Pantry Pride, met with his counterpart at Revlon, Michel C. Bergerac, to discuss a friendly acquisition of Revlon by Pantry Pride. Revlon rebuffed Pantry Pride’s overtures, perhaps in part because Bergerac did not like Perelman. The Revlon board of directors agreed to sell the company to Forstmann Little & Co. at a price of $56 per share. Pantry Pride announced that it would engage in fractional bidding to top any Forstmann offer by a slightly higher one. To discourage Pantry Pride, the Revlon board granted Forstmann the right to purchase Revlon’s Vision Care and National Health Laboratories divisions at a price some $100–$175 million below their value. Was the board within its rights in selling off these two divisions? Do the shareholders of Revlon have the right to prevent a sale of the company to Forstmann at a price lower than Pantry Pride offered? Is it ethical for a board to base a takeover decision on personal animosity? What are a board’s ethical obligations to shareholders?