In the dynamic world of business, mergers and acquisitions (M&A) can be a good strategy for company expansion and asset liquidation. For an M&A to be successful, beyond economic issues, it is necessary to consider various legal aspects that can directly impact the outcome of the transaction.
“Discussions in the market revolve a lot around synergies in the conclusion of operations, financial impacts,valuationand guarantees. They are notorious issues in M&A operations, and they are the purpose of any negotiation," says Gustavo Michel Arbach, Specialist in Business and Corporate Law. However, Gustavo emphasizes that the legal aspect also carries significant weight in these processes. Therefore, it is important to take some precautions and be legally prepared to ensure the success of the operations.
Below, Arbach highlights some tips for making an M&A safer and more efficient:
Count on experienced and trustworthy professionals
The success of an M&A directly depends on the quality of the advisory involved (mainly legal and financial). Having highly qualified and trustworthy professionals by your side, who focus exclusively on the best deal and the protection of your interests, but never lose sight of the goal of doing business, is essential to avoid risks and maximize gains.
Design scenarios and always consider the worst case scenario.
During the M&A process, it is important to conduct detailed risk analyses and proactively plan different scenarios. A lawyer should always project and anticipate the worst, as this approach allows for mitigating potential damages and avoiding unpleasant surprises along the way.
Attention to detail
The complexity of the procedures involved in M&A requires attentive and dedicated professionals. Lack of attention and perfectionism can result in weak, ambiguous, and legally questionable clauses. Even in contracts with many pages, all clauses must be complete and precise, accurately reflecting the parties' intentions in the agreement.
Attention to Post-Closing and Integration
The closing of an agreement is not the end of the process. The Post-Closing is an important phase that can directly impact the value of the transaction. Problems in company integration, contractual failures, and post-closing disputes can compromise the entire M&A effort. Always ensure that the entire process is meticulously designed.
Trade with those you trust
An M&A should not even begin if there is not the minimum trust between the involved parties. More than a well-drafted contract and adue diligencewell conducted, it is a premise that all parties involved have synergies and credibility. This is the best antidote against litigation and increases the chances that the agreed terms will be fulfilled in a transparent and beneficial manner for all.
“Following these guidelines can be the key to a successful M&A process, reducing risks and increasing the chances of a beneficial transaction for all parties,” concludes Gustavo.
