5 Ways to Streamline Your Response to Legal Issues in Mergers and Acquisitions
A streamlined response to a corporate merger or acquisition can benefit all parties. However, in the course of conducting due diligence for the transaction, legal issues in mergers and acquisitions can arise. How the acquiring and target companies respond to those issues can set the stage for a smooth transaction, or a stressful one. These five tips can help your organization streamline its response when issues come to light:
- Expect that there will be issues. Be realistic when starting the due diligence process and expect that it will uncover potential issues or areas you need to learn more about before you can comfortably close the transaction.
- Evaluate the potential impact of any issues. Before responding to one or more issues uncovered during the due diligence process, evaluate the extent to which the issues could impact the business. Certain issues may pose greater threats than others; identify up-front those issues that could be deal-breakers.
- Conduct thorough due diligence. Your response to potential legal issues can only be as good as the underlying information. Conducting thorough due diligence can ensure you have the most up-to-date and relevant information about potential legal issues.
- Evaluate the issues uncovered by due diligence. Some common issues that can be identified during due diligence are: ongoing or pending litigation, potential government investigations, compliance issues, state or federal tax issues, and antitrust concerns.
- Analyze the risks and determine whether or not to proceed. The reason for conducting M&A due diligence is to identify potential financial and legal issues in mergers and acquisitions. If legal red flags are identified, organizations need to understand their own risk tolerance and comfort levels.
Baer Reed handles due diligence and a variety of other legal support services for corporations and law firms handling mergers and acquisitions. To learn more about our services, contact us today.
- On May 31, 2018
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