The deals of mergers and acquisitions in India put the attorneys in exclusive positions as they are the people responsible for making the deal, carrying out the negotiations, and ensuring compliance with the regulations. However, that does not mean that the law practitioners are sufficient in themselves as far as their knowledge is concerned. There are times they also need to hone their skills while dealing with M&A transactions. The following are some of the tips the mergers and acquisitions law firms must follow.
1. General guide and other issues
The legalities of M&A transactions are filled with challenges and technicalities, which is reason enough for the companies to bring out an outside counsel with skills and expertise in this field. However, the in-house lawyers must become well-versed with the basic aspects of the deals such as the process of due diligence, the types of transactions, along with the warranties and representations your company needs to make. A majority of the M&A law firms undergo restructuring after the merger and it is not impossible for the attorneys to leave. When you are involved in the process of transaction, you can guarantee the safety of your job and consolidate your position in the firm. On the whole, you may become an indispensable resource for the firm with deeper involvement in the deal.
2. Schedules of disclosure
The schedules of disclosure is a significant aspect of a transaction deal and comprises information needed in the acquisition agreement. The lawyers must check whether the schedule of disclosure is erroneous, is not complete and improper, resulting in the breach of the agreement. In severe cases, the company acquiring another one may choose to walk out of the deal before it closes. When the disclosure schedules are incomplete, the law firms must pour over the schedules to determine if they have been properly drafted, and also rule out the possibility of allegations that may arise after the closure of the deal. The schedules are drafted under the guidance of the mergers and acquisitions lawyers and they must devote a significant amount of time to complete the work and start early to avoid the loopholes.
3. Negotiating the letter of the investment banker
The private companies moving forward with a transaction deal often hire investment bankers with adequate skills and the material terms and compensation between the parties come from them in the form of an engagement letter. This letter is usually drafted in favor of the banker. Allowing the top mergers and acquisitions law firms to go through the letter for proper negotiations is the most viable solution you can expect. However, you must ensure that the advisory services you get are appropriate and you are paying a suitable amount for availing those services. They have the experience which is needed to review the provisions of compensation and termination.
4. Keeping the deal confidential
The in-house lawyers must ensure that the prospective bidders have signed an NDA and the other provisions that prevent the bidders from hiring or soliciting the people of your company for a period of time. Apart from this, they must also create a plan for reiterating the confidentiality of the deal as many people within the company may have been already informed about the possibility of a sale. It is necessary to develop code names for the transaction as well as the parties involved in the deal, and ensure that it is properly used by the outside counsel along with the other members who are a part of the team of the deal.
5. Frequent and early communication with the team
Proper and effective communication is necessary with the management members, the outside counsel, and the board of directors for successful management of the sales process by the in-house counsel. Holding regular meetings with the internal and the external members and the outside counsel, accountant, and the investment banker is essential. Apart from this, it is necessary to communicate the structure of the transaction to all the members.
Merging with another company
How is the in-house counsel supposed to react when faced with a merger? It is hard to predict without knowing how much risk the legal team can take. Even the best M&A law firms must keep in mind the important strategies, negotiations, and considerations of due diligence and address the rest of the issues for making the deal successful.