As 2024 gets off to a busy start, companies, boards and management teams are facing a host of new and developing business issues and a large array of regulatory developments, from new and growing risks and opportunities from the adoption of artificial intelligence, to ever-changing ESG issues and backlash, as well as enhanced focus on government enforcement and review. As has become a tradition, we have asked our colleagues from around our firm to boil down those issues in their fields that boards of directors and senior management of public companies will be facing in the coming year, yielding focused updates in eighteen topics that will surely feature at the top of board agendas throughout the year.Continue Reading Selected Issues for Boards of Directors in 2024
In a May 29, 2023 opinion by the Delaware Chancery Court addressing a claim by sellers for specific performance under a merger agreement following buyer’s termination for breach of the capitalization representation, the court found that sellers breached the capitalization representation under the merger agreement based on the post-signing discovery that a former employee held phantom equity in a subsidiary of the target company. Despite buyer’s concession that the financial value of the former employee’s interest in the subsidiary was “minor relative to the deal value,” the court concluded that buyer was entitled to terminate the merger agreement since the capitalization representation was brought down flat at closing (and not subject to any de minimis or materiality qualifier).Continue Reading Private Equity Buyer Permitted to Walk From Deal Based on Capitalization Representation Breach
In a recent opinion addressing breaches of fiduciary duties and disclosure violations in connection with a take-private of Mindbody, Inc. by Vista Equity Partners, the Delaware Court of Chancery reinforced the significance (to both buyers and sellers) of avoiding conflicts in a sell-side process and ensuring all material facts are disclosed to the target’s board …
Antitrust enforcement agencies have recently asserted that private equity firms deserve heightened scrutiny when engaging in corporate transactions. However, in the recent Change Healthcare decision, the Court found that a proposed divestiture to a private equity sponsor would adequately preserve competition. Rejecting the DOJ’s arguments to the contrary, the Court found that the sponsor’s “incentives…
Last week, the Financial Crimes Enforcement Network of the Department of the Treasury adopted a final rule (the “Final Rule”) to implement the beneficial ownership reporting requirements of the Corporate Transparency Act, part of the Anti-Money Laundering Act of 2020.
This legislation requires a range of U.S. legal entities, and non-U.S. legal entities registered to…
With effect as from January 1, 2023, the German Supply Chain Act dated July 16, 2021 (Gesetz über die unternehmerischen Sorgfaltspflichten in Lieferketten – Lieferkettensorgfaltspflichtengesetz) will enter into force.
Undertakings of a particular size shall take responsibility for, and implement diligence standards with respect to, human rights-related and environmental risks in supply chains. An undertaking which is subject to the German Supply Chain Act, but not in compliance with the requirements stipulated thereunder, may face significant sanctions.
Continue Reading Germany Strengthens Corporate Social Responsibility in Supply Chains
Welcome to the Autumn edition of our UK Public M&A Round-up.
This issue includes:
- UK Public M&A Snapshot Q3 2021: Key themes over the past quarter.
- Rollovers in UK Public M&A Transactions: Why have rollovers been rising up the agenda?
- How Target Shareholders are Attacking Bids on Valuation Grounds: Why is this becoming more common
Welcome to our UK Public M&A round-up. Our round-up will feature select topics that highlight notable themes, trends and developments in the UK public M&A space.
Continue Reading UK Public M&A Round-up
As we have covered previously, one of the most noticeable trends that has emerged in the current boom in UK public M&A activity is the heightened level of target shareholder opposition to bids. This is manifesting itself in a number of ways, including through increased and novel “bumpitrage” campaigns as well as through institutional investors becoming more vocal in expressing their discontent at proposed bids. There appears to be a general feeling among a number of the largest UK institutional investors that private equity are acquiring UK public companies “too cheaply”.
Continue Reading UK Bids: Take-Private Boom Sees Negotiating Power Shift from Target Boards to Shareholders