M&A: legal prevention

M&A: legal prevention

News0 comments

M&A process always involve an acceptance about several risks, as we could see inprevious posts. Now, Evolutiza Lawyers & Tax Advisors wants to focus on legal risks that these operations could entail and how to solve them.

When we want to optimise the M&A process, we need to verify the current situation of involved company as well as their estimated projection. At the legal level, this supposes to accomplish a detailed study about certain factors, for example:

  • Article of association. These processes usually make necessary to carry out some changes on the article of association, even more if we keep in mind that legislation could have changed along the life of the company and not all companies keep their articles updated.
  • Civil liability insurance. Having or not civil liability insurance and its characteristics are fundamental to analyse risks that the company is exposed to
  • Contracts and licenses. Depending on the sector where the target company carries out its activity (Occasionally it is very different to the activity of the buyer company) and its size, there could be mistakes that we shouldn’t overlook.

These examples illustrate that it is really recommendable to rely on a comprehensive advise. The used prevent tool is the Due Diligence, a professional study which make possible to know the financial condition (including legal status) of the target company in order to avoid future obstacles. In the same way, a good decision about who will develop that Due Diligence can help to strengthen your contractual position in any M&A process.

Comments are closed.

Leave a Reply

You must be logged in to post a comment.