Due Diligence is Key in Mergers and Acquisitions
Structuring and negotiating an acquisition is always a challenge. Working with a
corporate lawyer with experience in your industry who has completed similar
transactions is crucial to ensuring a positive outcome. The Law Office of Stewart A.
Merkin has the experience and the expertise to help you navigate the many
considerations that business mergers or acquisitions demand:
— Deal structure: This must be decided early in any potential merger or acquisition
transaction. Plainly stated, you must decide how much of the company you are
interested in purchasing and how you want to effect that purchase.
— Payment: The total topline amount to be paid is not the only payment issue that
arises in M&A -- seller and buyer must also agree on the form of consideration.
— People: Human capital is an important part of what makes many companies
successful. Before you should consider purchasing a company, you must consider
the employees of the company and the extent to which they are assets you need
to acquire in order to realize the value of your investment.
There are many ways to determine the fair market value of a business, which can make
agreeing on a fair valuation challenging. You must look at not just the absolute book
value, but also capitalization of earnings, forecasted earnings of a company, and many
other factors. Usually, getting a third party, such as a professional appraiser or an
attorney, to do an assessment makes negotiating a fair valuation much simpler.
Stewart A. Merkin is an AV peer review rated lawyer by Martindale-Hubbell who has
been practicing law in Miami, Florida since 1974. The practice specializes in corporate
and business law, real estate, representing startups, mergers and
acquisitions, international transactions and nonprofit corporations. For more
information on our services, give us a call today.