Corporate Law 102: What A Mergers & Acquisitions Attorney Does:
Mergers and acquisitions provide growth and opportunities for expanding businesses. A lot of legal paperwork, filing, and negotiating are involved in these transactions. In order to get these things right, you should have an experienced Mergers & Acquisitions Attorney guide you with your business transaction. Corporate law firms are experts in handling these types of cases so FYI, that's who you're looking for. They will provide you with legal advice on how to proceed and ensure your paperwork is compliant with the law.
Why do businesses do mergers & acquisitions?
To broaden their market – having a larger geographical spread or acquiring niche markets increases the growth potential of companies.
To improve efficiency – by increasing the scale of operations or gaining better control (e.g. having more supplies) a company can produce goods more efficiently.
To gain access to more resources – financing, skills, intellectual capital, or raw materials.
To provide more products, services or facilities – this could include getting access to patented products, having more storage facilities, and wider distribution channels.
Why do these transactions fail?
Failure to negotiate agreeable terms – the parties could not find an agreement where the terms were favorable to them, but negotiations may have fallen through because of different expectations, risk profiles, or cultural factors.
People failure – cultural differences, hostility among workers, and resignation from employees are a major concern with the transition.
Financial failure – expected return on investment or turnover were not achieved, or the solvency of the company was at risk.
Implementation issues – sometimes the merger and acquisition was not compatible and the merge proved difficult. Re-training people, acquiring new assets, and using new IT systems may completely change the way the business operates.
How can a merger and acquisition lawyer help you?
Strategy – the merger and acquisition should be thoroughly planned and be treated as a large project. The advice, business experience, and insights of a lawyer can be very important input for your business.
Assessing the risks and rewards – legal issues & existing corporate contracts must be heavily weighed when making such decisions. In addition, all relative business and financial risks must be studied. What do you stand to lose and gain in the process? It should be carefully analyzed with due diligence.
Setting budgets – determine the expected costs of the merger and acquisition and constantly monitor expenses. It should be feasible for the company to get a decent ROI with the transaction.
Proper communication – all involved parties should be aware of the details of the transaction. Expectations should be communicated and agreed upon. Communication with employees, clients, stock holders, suppliers, and other business parties should be done appropriately and timed properly. Rumors must be stopped and addressed immediately to prevent panic.
Have a trustworthy advisor by your side – Mergers and acquisitions are a one-time experience for many businessmen and they don’t have the experience or knowledge to handle the transaction. A good lawyer will give you advice on how to handle the move and who can help you with it. They may be able to recommend some experienced auditors and business consultants to help you facilitate the transaction.
A company attempting to perform a merger and acquisition could be the most important game-changing strategy for the business. It could make or break the business. In order to help determine if the transaction will be beneficial for the business and that all legal requirements are complied with, seek the assistance of a merger and acquisition lawyer.
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