ACQ WS 1 -9 Detailed notes Mergers & Acquisitions

Due diligence The art of due diligence is to understand your client’s objectives and to ensure that the legal due diligence exercise concentrates on the issues that are important. TYPES: 3 key areas of review Commercial ⟶ Done by ⟶Buyer itself, or ⟶If buyer is a company, senior managem...

The terms of acquisition: Price and payment The SPA is the key document for the sale and purchase of a company. It documents the BYR’s agreement to purchase the shares and pay the relevant price on Closing and the SLR’s agreement to sell the target co. The commercial terms of the agreement ar...

Allocation of Risk Buyer will want some REASSURANCES about the nature and state of the company/business that it is acquiring and the possibility of recompense if the acquisition does not turn out as expected. WARRANTIES AND INDEMNITIES will be included in the sale and purchase agreement so as to ...

Conditional Contracts and Closing Before completing an acquisition various approvals, consents and clearances may be required (problems holding up deal), and ideally should be obtained before the sale and purchase agreement is signed. However, obtaining the necessary consents and approvals can ta...

Asset Acquisitions (Transferring Assets and Employees) What should be transferred? ⟶ Aim to have a COMPREHENSIVE DEFINITION OF “BUSINESS” to cover all the assets you want ⟶ Not unusual to have separate provisions for certain types of assets (e.g. goodwill) ⟶ Include a list of assets wh...

Private Equity It is simply an INVESTMENT in the share capital of a private company MCQ topic likely By acquiring shares (and thereby ownership rights in a company) the investor hopes to receive INCOME from the profits generated by that company and to make a CAPITAL GAIN from the onward sale of t...

Public Offers The main source of regulation of takeovers of PUBLIC COMPANIES is called the TAKEOVER CODE ON TAKEOVERS AND MERGERS. What is the PURPOSE of the Takeover Code? Ensure fair and equal TREATMENT of all shareholders in an offeree company in relation to takeovers; Provide an orderly FRA...

Schemes of Arrangement Question 1 What kind of scheme is contemplated by the Scheme Document and how does it work to transfer control of the target to the bidder? ⟶ The scheme is a TRANSFER SCHEME = the shares in the target (Domino) not already owned by the bidder (Brother) are transferred to ...