Mergers & Acquisitions
Mergers and acquisitions (M&A) involve the merging of two businesses or companies to form a new legal entity. This legal entity is created under a new business name. Acquisition involves the purchase of another entity or company.
There are several different types of transactions within M&A. This includes tender offers, consolidations, management acquisitions, acquisition of assets and various other ways of combining or merging companies into another entity. Few of these ways include vertical mergers, horizontal mergers, congeneric mergers, purchase mergers, consolidation mergers, product-extension mergers, market-extension mergers, conglomerations, and reverse mergers.
There are legal ramifications associated with each type of M&A requiring a business law attorney to negotiate, draft and execute contractual agreements for all involved parties.
Attorneys at SBEMP (Slovak, Baron, Empey, Murphy & Pinkney) law firm provides professional legal advice and services to clients in Palm Springs, Palm Desert, Rancho Mirage, Inland Empire, Orange County, Coachella Valley, Costa Mesa, San Diego, New Jersey, New York, and surrounding communities.
This is the process by which two different companies join together to become a new one. This is also known as consolidation. Neither of the two companies can function independently in case of a merger.
This is when a company takes over the assets of another. Takeover or acquisition is the purchase of a business by another. These are of two types – public and private. The difference depends on whether the target company’s stocks are publicly traded or not. Acquisitions can be hostile or friendly depending on the outlook of the target company.
Federal Trade Commission
The FTC or Federal Trade Commission is responsible for ensuring that transactions are compliant with anti-trust and fair competition laws. There is always the concern of a single entity taking over a too large market share or resorting to anti-competitive behavior.
Securities and Exchange Commission
The Securities and Exchange Commission (SEC) ensures that there are no illegal activities, such as improperly devalued stocks, insider trading or any other inappropriate conduct.
Law Firms with M&A Expertise
Law firms can provide guidance on:
- Corporate carve outs
- Cross border transactions
- Asset and equity purchases
- Exchange offers
- Hostile takeovers
- Joint ventures
- Fiduciary duty and disclosure issues
- Going private transactions
- Leverage buyouts
- Proxy battles
- Restructurings and recapitalizations
- Minority investments
- Poison pill and counseling on other defensive measures
- Roll up transactions
- Sales of controlling interests
- Subsidiary spinoffs
Need for Legal Guidance
Mergers and acquisitions are common in any industry. They usually occur for a wide variety of reasons, such as diversifying business operations and offerings, increasing value, lack in financial capacity, acquisition of assets, tax purposes and personal interests. It’s vital that you have a legal team for assisting you with the transaction regardless of the reason.
Experienced M&A attorneys work directly with their clients and advise them on negotiating, drafting, and executing of contracts for the sale. They also help put in place adequate financing, including stocks and cash. M&A is a unique process that has given rise to an industry with a number of stock brokers, law firms, and accountants among other business experts dedicating their practice to it.
Lawyers at the SBEMP law firm serve clients from Palm Springs, Palm Desert, Rancho Mirage, Inland Empire, Orange County, Coachella Valley, Costa Mesa, San Diego, New Jersey, New York, and nearby locations for a range of legal practice areas.
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For more information or to request a consultation please contact the law offices of SBEMP (Slovak, Baron, Empey, Murphy & Pinkney) by clicking here.
SBEMP LLP is a full service law firm with attorney offices in Palm Springs (Palm Desert, Inland Empire, Rancho Mirage, Indian Wells), CA; Indian Wells, CA; Costa Mesa (Orange County), CA; San Diego, CA; New Jersey, NJ; and New York, NY.
DISCLAIMER: This blog post does not constitute legal advice, and no attorney-client relationship is formed by reading it. This blog post may be considered ATTORNEY ADVERTISING in some states. Prior results do not guarantee a similar outcome. Additional facts or future developments may affect subjects contained within this blog post. Before acting or relying upon any information within this newsletter, seek the advice of an attorney.