In the age of globalization, it is important to formulate a fast and effective growth strategy to reach into global market. New ventures or offices are just one tool for growth – and not necessarily the fastest or the most cost-effective. If there are existingcompanies in the region, then mergers or acquisitions can prove a more effective option.
Mergers and acquisitions are an efficient strategy for companies to expand their business operations beyond national borders without expending the time or resources needed to establish foreign corporateoffices or start wholly owned subsidiaries. In a merger or acquisition, existing market players are joined with the company – by either folding one within the other, or combining the two at every level.
Mergers and acquisitions can also be a tool for diversification, expansion or consolidation. Using these transactions, companies can change the nature of their business, expand their sphere of influence, condense their operations, or expand along the service chain. It is an integral part of corporate business practices and will continue to develop with the growing competition in the international market.
In choosing a merger or acquisition, it is important to understand the function of each and the difference between the two.
Mergers involve the combination of two business entities into a third, new organization. This is a complex model, which involves the reformation of the companies at a basic level – and involves the alteration of both parties as well as the creation of a new, joined organization. Discussions and documentation of a merger is similarly complicated, and require the greatest of care and caution to execute.
Acquisitions, on the other hand, involve the complete absorption of one company into another. Here one company is completely dissolved – its assets, staff, and obligations being transferred over to the other. While the fallout from an acquisition might become as complex as that of a merger, the process is much simpler.
Generally, an acquisition is the better choice for companies of varying sizes and resources – while companies of equal standing would be better served by a merger.
Whether choosing a merger or acquisition, the process involved is intricate and involved.
Analysis - The first step towards a merger or acquisition is identifying the right target. This includes finding a target of the right size and scale in the industry, identifying which form of joinder should be used, and proper due diligence of the potential partner. Our experienced attorneys can help through this step, to get your merger or acquisition off on the right foot.
Negotiation - Going from offers to final agreementinvolves several intricate details and minor variations of law that can have major consequences on the viability of the organization after execution. Discussing these details, handling proper valuation, and ensure full compliance with applicable laws can prove tricky and time-consuming for an organization to handle on its own.
Our attorneys can help through the negating process. This involves drawing up a list of enforceable terms, and rigorously negotiating with opposing counsel to get you the best deal you can get.
Drafting - Once you have fully formed an agreement, the deal still must be solemnized into a binding contract. Otherwise, while you may think the deal settled, it will be difficult to hold the other party to the agreed upon terms. Our attorneys can help – by drafting a contract that expresses the totality of your agreement, in a form narrowly tailored to protect your interests and within the bounds of the law of the land.
Execution - Once an investment contract is negotiated and drafted, it still must be executed to become binding. Moreover, the corporate documentation of both parties must be reformed and re-executed in order to reflect the merger or acquisition.
Our attorneys work to facilitate the execution of contracts across borders, to ensure that the requisite formalities for all appropriate jurisdictions are met to solemnize and enact your agreement and make it enforceable.
Companies involved in mergers and acquisition transactions need experienced legal guidance to ensure a fair, safe and beneficial transaction. We work with a panel of internationally trained and experienced experts to develop a clear and effective merger and acquisitions strategy to ensure advantageous and effective transaction for our clients.
At the Law Offices of Akash Kashyap, Esq., we use only the best corporatelawyers available. Our attorneys are licensed and trained to operate in the US and India, and specialize in Indo-US transactions – including Mergers and Acquisitions.We provide these legal services both through our New Delhi and Gurgaon offices, as well as online.