Mergers and acquisitions have grown considerably in the last decade and the trend is likely to continue in the near future. When companies want to diversify their portfolio or want to enter new markets, they look at mergers and acquisitions as the easiest and quickest route to achieve their goals. It gives them access to established products and markets as well as new technologies. However, the process is quite complex and requires careful and diligent planning. Merger and acquisition companies in India point to the fact that many big-ticket M&A transactions have failed because of ill-advised decisions.
As mentioned above mergers and acquisitions transaction is a complex process, and is intensely examined by the regulatory authorities as well as the investors. To ensure that your business does not end up on the receiving end of the bargain and achieves its financial goals, expert legal advice is very important. The law firm or an individual attorney you choose to represent you must be highly competent in dealing with M&A transactions. We have listed below a few questions that you should ask before you decide on a firm or an individual to represent you.
Is Your Company Ready for the Sale?
If you are planning to sell your company, make sure that it is ready for it. When you put your company up for sale, a prospective buyer will delve into every aspect of the business. There could be several techno-legal issues that hitherto did not affect your business operations, but you still need to address those issues before you put your company on the block. Ignoring these issues or failure to address them in time can prove costly and even lead to litigation at a later stage. It is, therefore, paramount that you have the right legal representation to guide you through the right course of action.
How Experienced the Lawyer is?
However common mergers and acquisitions may have become these days, it is still a very complex process. You should look at the experience of the lawyer in handling M&A transactions. More than theoretical knowledge, it is the practical experience that counts. Also, there are certain differences in procedures across industries, so make sure the lawyer you intend to hire has experience in your industry. If you are in a strictly regulated industry, it is all the more important that the lawyer has experience of working within that specific industry. It would be a bonus if the lawyer is well versed in accounting and taxation laws.
Can the Lawyer Represent you well?
According to the merger and acquisition companies in India, advising the board members is one of the most important roles of a lawyer. The lawyer is the face of the other firm for the board members, who need timely and concrete advice. There are risks and complexities, and there could be times when you find yourself in a dilemma whether to move forward or retract. The M&A lawyers help you get through the deadlock. It is, therefore, paramount that the lawyer is able to handle the opposing board, and that quality comes with experience.
Are They Familiar with Sophisticated Finance Agreements and the Legal Issues to Raise?
There are many sophisticated commercial finance agreements that come into play in M&A transaction, a lawyer has to be familiar with those terms to make a positive difference to the seller. Also, the lawyer must be aware of the specific legal concepts that need to be raised in such transactions. Experienced lawyers should be well versed in these concepts.
Will the Attorneys you met work with you on the Deal?
Most of the larger law firms have a pyramid-like structure with a few senior lawyers at the top and a lot of middle levels and junior level attorneys lower down the pyramid. It is generally seen that when a firm pitches for a client, the senior partners get involved, but once you hire the firm it’s the junior associates who handle the case. Although the junior and middle-level associates may be smart in their handling of the deal, lack of experience may lead to the deal not going as smoothly as you hoped for.
Does the Law Firm Offer Services in Other Associated Areas of Law?
Many specialized areas of law are linked to M&A transactions, such as tax laws, intellectual property, finance, etc. If the law firm can provide expert advice on these matters it will be an added advantage for you as the firm would be already aware of your situation.
Can they give an Estimate of the Expected Fees?
If all the material facts are presented, an experienced M&A lawyer should be able to give a reasonably correct estimate of the fees. Though the fees may vary depending on the complexities of the deals, an experienced lawyer will still be able to give you a range.
There are many merger and acquisition companies in India who regularly deal in such transactions, who can help you through the entire process of M&A transactions. However, the questions mentioned above must be asked when you are hiring an M&A lawyer.