Mergers & Acquisitions: A Practical Guide for Private Companies and Their UK and Overseas Advisers | by Jonathan Reuvid (ed) | ISBN: 9780749452698. Private Equity and VC Investment. Professional Advisers for Alternative Investment Market (AIM) Flotation. Legal Documentation for Purchase of a Company
Mergers & Acquisitions: A Practical Guide for Private Companies and Their UK and Overseas Advisers
by Jonathan Reuvid (ed)
ISBN:9780749452698
Written by leading players in the field, the book explores the strategic issues and challenges you may face when merging with or acquiring another business, while placing particular emphasis on the legal, taxation and financial implications.
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Mergers & Acquisitions — A Practical Guide for Private Companies and Their UK and Overseas Advisers
Introduction
Part One – M & A As a Business Strategy
Chapter 1.1 – Growth Curve, Plateau or Peak? An Entrepreneur’s Guide to Growth
What does growth mean?
Lifestyle?
Chapter 1.2 – Alternatives to Flotation—Accessing Capital and Exit Strategies
Why do companies float?
Accessing capital
Exit strategies
Conclusion
Chapter 1.3 – Selling a Private Company
Introduction
Key factors that influence a successful sale
The project brief
Chapter 1.4 – Acquisition Target Strategies
Overview
The need to increase the number of targets
The need to improve appropriateness of targets
The need to be more creative in target identification
The need for forward planning
Conclusion
Chapter 1.5 – The Challenges of Management Buy-outs
Overview
MBO OR EBO?
How much, and how?
Fiduciary duty and other conflicts
Silence is golden
Warranties: to be, or not to be?
Relationships
Fair play
Conclusion
Chapter 1.6 – The Meteoric Rise of the MBO
Backdrop
Why have MBOs become so popular?
The most common types of MBO
Characteristics of a business suitable for a buy-out
Where difficulties can lie
Recent trends in the MBO marketplace
A view of the future
Chapter 1.7 – Grooming a Business for Sale
Introduction
Positioning
Financial matters
Strategic/operational matters
Review of business plan and strategy
Legal review
Other matters
Vendor due diligence
Conclusion
Part Two – Funding Considerations
Chapter 2.1 – Overview
Introduction
Equity and debt funding permutations
Parameters for investor-friendly business planning
Negotiating the finance
Chapter 2.2 – Private Equity and VC Investment Perspectives
Corporate finance for technology and media companies
Operational considerations
Financial considerations
Investor protections
Summary
Chapter 2.3 – Consideration
Types of consideration
Cash
Share capital
Loan capital
Consideration structures
Chapter 2.4 – Crystallizing Value
Strategy for exit
What are the exit routes?
Grooming the company for exit
Marketing the business for sale
Handling offers
Negotiating the deal
Conclusion
Chapter 2.5 – Pensions Issues
Background to pension arrangements
Due diligence issues
Summary
Part Three – The Mechanics of M&A
Chapter 3.1 – Overview
Overview
Structure
Due diligence
Apportionment of risk
Key considerations for management
Chapter 3.2 – Identifying Partners and Targets
Objectives decided
Acquisition process
Moving forward
Chapter 3.3 – Appointing Advisers
Chapter 3.4 – Approaching Partners and Targets
Method of approach
Drawbacks of approaching companies that are for sale already
What buyers usually want
Style of approach
Content of approach
The goals
Chapter 3.5 – Negotiating Techniques for the Seller
Introduction
Early negotiations and competitive bids
Some negotiation points
Concluding the deal
Concluding thoughts
Chapter 3.6 – Taxation and Accountancy Considerations
Introduction
Taxation issues
Accounting issues
Conclusions
Chapter 3.7 – Legal Considerations in Making an Acquisition for Smaller Companies
Introduction
What is an acquisition?
Why make an acquisition?
How to make an acquisition
Key legal considerations
Share sale and purchase agreement
Practical matters
Summary
Chapter 3.8 – Common Features in the Acquisition of Private Companies
The professional team
Approaching the seller
Kicking the tyres
Paperwork
Signing on the dotted line
The MBO vehicle
After sales
Part Four – The Process of M&A
Chapter 4.1 – Introduction
Overview
Structuring the deal
The pressure of time
Keeping the sellers onside
Avoiding misunderstandings
Project management
Expect the unexpected
Too many cooks …
Achieving the plan
Auction sales
Conclusion
Chapter 4.2 – Critical Issues in M&A Transactions for SMEs
Overview
Price and payment terms
Completion balance sheets
Earn-outs
Warranties and indemnities
Who gives warranties?
Limitation of seller’s liability under warranties
Chapter 4.3 – Legal Documentation — Where to Start
The ‘typical’ transaction
Confidentiality letter
Heads of terms
The next step
Chapter 4.4 – Legal Documentation — Purchase of a Company (Share Sale)
Deal structures
The ‘key’ documents
Ancillary documents
The share sale agreement
The tax deed
The disclosure letter
Closing the deal
Chapter 4.5 – Legal Documentation — Purchase of a Business (Business Sale)
The nature of a business sale
The ‘key’ documents
How does a business sale agreement work?
Similarities between a business sale agreement and a share sale agreement
Deciding which assets and liabilities are to be transferred
Transferring tangible assets
Transferring intangible assets
Transferring liabilities
Transferring employees
Pensions considerations
Tax
Closing the deal
Chapter 4.6 – Due Diligence
What due diligence is
What due diligence involves
History and commercial activities
Conclusion
Chapter 4.7 – Acquisitions of Smaller, Owner-managed Businesses
Introduction
Deal structures
The buyer’s concerns
The sellers’ concerns
Conclusion
Chapter 4.8 – Cautionary Tales
Does everyone want to sell?
Not buyer beware, but beware the buyer
Don’t neglect the housekeeping
Due diligence and disclosure
Choose your advisers carefully
Part Five – Shareholders’ and Directors’ Considerations
Chapter 5.1 – The Acquisition Process, From Start to Finish – and Beyond
Introduction
Four key objectives to getting it right
Chapter 5.2 – Financial Public Relations in M&A Environments
The role of financial public relations in M&A transactions
The rules of financial PR
Chapter 5.3 – Post-M&A Change Management — Taking Charge of Change
Overview
Why is the success rate for business change programmes in the UK so low?
Expectations versus outcomes
Chapter 5.4 – Taxation Issues
Introduction
Deal structure
Key shareholder relief
Pre/post sale planning
Funding the acquisition (TCGA 1992, ss 150A–D, Sch 5B, s 151B, Sch 5C; ICTA 1988, Sch 28AA, s 842AA, Sch 15B, Sch 28B; FA 2000, Sch 15; FA 2006, Sch 14)
Form of consideration planning (TCGA 1992, s 48, s 280)
Other matters
Conclusion
Chapter 5.5 – Insurance Issues in M&As
Insurance due diligence
Warranties and indemnities
Solutions
Other transactional insurance products
The importance of being earnest
Chapter 5.6 – Service Agreements and Pension Provisions
Background to service agreements
Types of senior management pensions
Point of transaction as a trigger for change
Agency costs and DB pensions
Annual pay reviews and promotions
Other pension issues with service agreements
Summary
Chapter 5.7 – Preparing for Admission to the Alternative Investment Market (AIM)
The benefits of joining AIM
The admission process
Pre-admission phase
Admission process
Post-float issues and ongoing requirements
Chapter 5.8 – How to Choose Your Professional Advisers for an AIM Flotation
Overview
NOMAD
Broker
Lawyers to the company
Accountants
Financial PR
Ofex (PLUS Market) instead of AIM
Are you paying by the hour?
Summary
Contributors’ Contact List
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