[COVID-19] Mergers and Acquisitions

May 1, 2020 by Geraci LLP

Given the unusual circumstances of running a business during a pandemic, many companies are looking to change how they do business, including mergers and acquisitions.

What are Mergers and Acquisitions?

Mergers and acquisitions (“M&A”) are transactions where the ownership of companies is transferred or consolidated with other entities. Businesses may seek to merge with a larger, more established company to better ensure its long-term existence. On the other hand, larger and more well-positioned companies may decide the time is right to acquire a competitor or complimentary business to add to its business or improve its competitive position.  

Factors to Consider in a Merger or Acquisition Transaction

Below is a list of just a few of the aspects you are likely to confront in a merger or acquisition:

Three typical methods to acquire a business:

  • Purchase of the company’s assets
  • Purchase of the company’s stock
  • Direct or indirect merger with the company

Preliminary Agreements:

  • Term Sheet
  • Confidentiality Agreement
  • Exclusivity Agreement

Due Diligence:

  • Determine the value of what you’re getting
  • Understand the specific assets and liabilities involved
  • Decide how to acquire and restrictions on future use
  • Create a plan for integration of operations
  • Provide disclosures

The Agreement:

  • Merger Agreement
  • Stock Purchase Agreement
  • Asset Purchase Agreement

Closing and Post-Closing:

  • Delivery and execution of documents
  • Closing certificates
  • Third-party consents
  • Other related agreements
  • Transition plan

If you are exploring the possibility of selling your business or merging with another company, Geraci Law Firm has the expertise to guide you through this complicated process. Reach out to the Corporate and Securities team here.

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