On 7 July 2017, the UK Takeover Panel published Practice Statement No 31, which describes the way in which the Panel Executive normally interprets and applies certain aspects of the Takeover Code when a company wishes to seek bidders for itself, typically via an announcement of a formal sale process or a strategic review that may result in a sale. The publication of PS31 indicates that the Executive intends to be more prescriptive about the application of the Code to auctions conducted by the target company. The key rules of the Code affected by PS31 are Rule 2 (secrecy and announcements), Rule 21.2 (deal protection measures) and Rule 21.3 (equality of information between bidders).

Please click here to read the full alert memorandum.

The German M&A market holds its ground; despite falling transaction volumes, transaction values are on the rise. Q2/2017 sees Fresenius agree both the acquisition of U.S. competitor Akorn and that of Merck’s biosimilars business. John Deere acquires road construction equipment manufacturer Wirtgen. 1&1 Telecommunications and Drillisch are set to be brought under the umbrella of United Internet and German property group TLG presents WCM exchange offer. Continue Reading.

The German M&A market has remained active in Q1/2017: General Motors agreed the sale of Opel to Peugeot, Henkel made another US acquisition with Darex, and Clayton Dubilier & Rice sold the industry packaging specialist Mauser on to BWAY. The merger between Linde and Praxair is imminent. The London Stock Exchange and Deutsche Börse merger, however, looks set to fail due to Brexit, among other factors. Continue Reading

M&A transaction documents often contain an exclusion or limitation of the seller’s liability for “consequential”, “indirect” or “special” losses suffered by the purchaser.   For instance, a purchase agreement will often provide that the liability of the seller under the warranties does not extend to these types of losses.

It appears that purchasers often agree to an exclusion or limitation of this type on the assumption that such exclusion has a well-established and relatively narrow meaning which excludes only losses which arise in a small minority of cases.  This assumption, although historically supported by decisions of the UK courts, has appeared over the past handful of years to be increasingly less tenable. A recent UK High Court decision in Star Polaris LLC v HHIC-Phil Inc. now casts further doubt on the appropriateness of making this assumption.

Please click here to read the full alert memorandum.

 

Following the international record set in 2015, the M&A market in 2016 has proven to be robust. External influences such as the Brexit referendum in early summer and the U.S. presidential election in November did in fact have an impact, but the M&A market has held its own despite the apprehension on several fronts. In particular, the announced Bayer/Monsanto transaction caught the attention of market participants worldwide. Even though this was the largest foreign investment by a German company, it was just one deal in an eventful year for M&A in Germany. Continue Reading

 

Part 2:  Risks Associated with Transfers of Personal Data and Post-Closing Integration

One aspect of mergers and acquisitions that is receiving growing attention is the relevance of privacy issues[1] under U.S. and European Union (“EU”) laws as well as the laws of a growing number of other jurisdictions.[2]  This two-part blog post discusses the principal M&A-related privacy risks and highlights certain “traps” that are often overlooked.  In Part 1, we discussed risks associated with a target’s pre-closing privacy-related liabilities and considered ways to mitigate these risks through adequate diligence and privacy-related representations in M&A agreements.  In this Part 2, we discuss the risks associated with transferring or disclosing personally-identifiable information (“personal data”) of an M&A target (or a seller) to a purchaser (or prospective purchaser) and those associated with the purchaser’s post-acquisition use of such personal data.

Continue Reading Privacy in M&A Transactions: Navigating the Traps, Part 2

Part 1: Risks Associated with the Target’s Pre-Closing Privacy-Related Liabilities

One aspect of mergers and acquisitions that is receiving growing attention is the relevance of privacy issues[1] under U.S. and European Union (“EU”) laws as well as the laws of a growing number of other jurisdictions.[2]  This two-part blog post discusses the principal M&A-related privacy risks and highlights certain “traps” that are often overlooked.  In this Part 1 of the post, we discuss risks associated with a target’s pre-closing privacy-related liabilities and consider ways to mitigate these risks through adequate diligence and representations in M&A agreements.  In Part 2, we will discuss the risks associated with transferring or disclosing personally-identifiable information (“personal data”) of an M&A target (or a seller) to a purchaser (or prospective purchaser) and those associated with the purchaser’s post-acquisition use of such personal data.

Continue Reading Privacy in M&A Transactions: Navigating the Traps

Theresa May, the new UK Prime Minister, commented that the UK Government should adopt an industrial strategy capable of “stepping in” to defend sectors that are important to the UK economy from acquisition by overseas acquirors.  Linked is an alert memorandum prepared by our Brexit Working Group, which focuses on the existing powers available to the UK Government to prohibit acquisitions of UK companies (or indeed non-UK companies with UK operations) on “public interest” grounds within the confines of EU law and discusses how these might be expanded following Brexit. Continue Reading Industrial Strategy Post-Brexit: The UK’s Power To Block Mergers On Public Interest Grounds

On 12 September 2016, the rules of the UK Takeover Code governing the communication and distribution of information during a UK takeover bid will change. The rules and requirements affected are summarized in the attached memo and include the chaperoning requirement for meetings and calls with shareholders and analysts, new rules relating to the use of materials during meetings and calls, and new rules relating to the use of social media and videos during bids.  Continue Reading UK Takeover Code Update: The Communication and Distribution of Information During a UK Takeover Bid

Companies based in the People’s Republic of China have committed to over $100 billion of overseas acquisitions since January 1, 2016, including a number of high profile targets in the United States and Europe.[1] The ties of these buyers to governmental entities in the PRC, coupled with the unpredictability of the PRC government, and the challenges that a non-PRC counterparty faces when seeking to enforce contractual obligations and non-PRC judgments in PRC courts has led practitioners to implement an array of innovative provisions in M&A Agreements. Continue Reading How M&A Agreements Handle the Risks and Challenges of PRC Acquirors