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New BKPM regulation clarifies guidelines and procedures for licensing and facilities under FDI regime
Ali Budiardjo, Nugroho, Reksodiputro
  • Indonesia
  • 11 September 2019

Indonesia's Investment Coordinating Board (BKPM) recently issued a new regulation that amends BKPM Regulation 6/2018, which sets out guidelines and procedures for licensing and facilities under Indonesia's foreign direct investment (FDI) regime. The most significant changes include the reaffirmation that certain FDI companies must comply with divestment obligations and the confirmation that shareholding foreign directors and commissioners are exempt from the normal expatriate employment rules.

Private M&A on trial: interpreting private M&A sale and purchase provisions
Davis Polk & Wardwell LLP
  • United Kingdom
  • 11 September 2019

Two recent High Court of Justice decisions provide guidance on the interpretation of provisions customarily included in sale and purchase agreements for the acquisition of private companies or businesses. In the first decision, the court considered whether the provisions of a purchase price procedure were conditions precedent. In the second decision, the court considered the scope of a restrictive covenant in an employment agreement and its impact on sale and purchase agreements.

Private M&A on trial: damages for breach of private M&A accounting warranty
Davis Polk & Wardwell LLP
  • United Kingdom
  • 04 September 2019

The High Court of Justice recently considered two disputes regarding breaches of warranties arising from the acquisitions of private companies. The decisions affirm the orthodoxy that the measure of damages for breach of warranty included in a sale and purchase agreement for the sale of shares is the diminution in the value of the shares purchased but also sound a warning to sellers that have struck a poor economic bargain.

Bulk transfers
Meyerlustenberger Lachenal
  • Switzerland
  • 28 August 2019

Under Swiss law, the acquisition of a business may be structured as a mere share deal, a mere asset deal or – according to the Merger Act – a statutory merger, demerger or bulk transfer. This article outlines the corporate law aspects of bulk transfers and distinguishes between domestic and cross-border bulk transfers.

KCOM takeover – Takeover Code default auction process
Davis Polk & Wardwell LLP
  • United Kingdom
  • 14 August 2019

Since June 2019, Universities Superannuation Scheme and Macquarie have been engaged in a competitive takeover battle for KCOM (a telecoms company). As was the case for the recent Sky takeover, it proceeded to an auction. However, instead of the parties agreeing to their own set of rules for the auction, the Takeover Panel's default auction rules were used, making it the first time that they have been used for a UK takeover.

Private M&A transactions and PACTE
AyacheSalama
  • France
  • 31 July 2019

The recently adopted Action Plan for Business Growth and Transformation contains new rules that will be of interest to parties that undertake private M&A transactions, particularly those involving foreign investment. Further, it clarifies the measures that the minister of economy can take should an investor pursue an investment without prior authorisation or fail to comply with the conditions set out by the minister in such prior authorisation.

In Delaware, notices and deadlines matter
Ropes & Gray LLP
  • USA
  • 03 July 2019

A recent Delaware Court of Chancery decision is illustrative of the principle that merger partners should not assume that anything less than strict compliance with notice requirements (particularly when they relate to termination rights) and deadlines in a merger agreement will be enforced. The case is also a cautionary tale of why one merger partner should never assume that the other merger partner still wants to do the deal as much as it does.

Private mergers and reorganisations
Meyerlustenberger Lachenal
  • Switzerland
  • 12 June 2019

Under Swiss law, the acquisition of a business may be structured as a mere share deal, a mere asset deal or – according to the Merger Act – a statutory merger, demerger or bulk transfer. This article outlines the private law aspects of private statutory mergers and distinguishes between domestic and cross-border statutory mergers.

Leverage buyouts – an overview
Kayum & Demir
  • Turkey
  • 29 May 2019

A leveraged buyout (LBO) is a term used for a variety of transactions in which buyers (usually private equity firms) use leverage to acquire a company's shares. However, it is impossible to fully mitigate the risk that a target is deemed to provide financial assistance for the purchase of its own shares if the acquirer uses an LBO and the target provides guarantees or securities over its own assets due to a lack of established precedents. This uncertainty means that a diligent analysis is required for each transaction.

Supreme Court facilitates financing companies with cross-border business
Schoenherr
  • Austria
  • 15 May 2019

For the first time, the Supreme Court has upheld a security right granted under German law, even though the asset had been transferred to Austria. Previously, such rights were terminated once the asset was moved from Germany to Austria. The decision will substantially facilitate the financing of companies with cross-border business.

DOJ commentary underscores importance of pre-acquisition diligence
Ropes & Gray LLP
  • USA
  • 15 May 2019

In a July 2018 conference speech the Department of Justice (DOJ) deputy assistant attorney general (DAAG) for the Criminal Division underscored the importance of pre-acquisition Foreign Corrupt Practices Act (FCPA) diligence. The DAAG's remarks reinforced FCPA enforcement as a DOJ priority and provided a disclosure roadmap for buyers that uncover FCPA-related misconduct both pre and post-acquisition.

How to deal with existing pre-emption rights in private M&A transactions
AyacheSalama
  • France
  • 08 May 2019

The Supreme Court recently ruled that the granting of a call option over an asset which is subject to a pre-emption right violates such pre-emption right. In this specific case, the call option had been exercised when the pre-emption right was no longer applicable. However, the court held that the transfer had breached the pre-emption right as it had resulted from the exercise of a call option agreement that had been entered into when the pre-emption right was still applicable.

Takeover Panel: roundup of recent panel statements
Davis Polk & Wardwell LLP
  • United Kingdom
  • 24 April 2019

The Takeover Panel recently published a revised version of the Takeover Code to reflect amendments relating to the response statement to its October 2018 consultation on asset valuations and the Financial Conduct Authority's announcement that it will phase out the United Kingdom Listing Authority name. In addition, the panel recently published a rule-making instrument concerning the response statement to its consultation on the United Kingdom's withdrawal from the European Union.

Addressing #MeToo in M&A
Ropes & Gray LLP
  • International
  • 17 April 2019

Companies in all industries are facing heightened reputational and legal risks in the #MeToo era, as employees are more likely to identify and report instances of misconduct or discrimination in the workplace (and such instances are more likely to become public). In the world of M&A, reputational and legal risks are ultimately risks to the bottom line – prompting private equity sponsors, institutional investors and strategic purchasers to focus on #MeToo issues when sourcing, diligencing and negotiating investments.

Chancery Court revisits fair value analysis in AOL appraisal action
Ropes & Gray LLP
  • USA
  • 10 April 2019

The Delaware Court of Chancery has issued its original opinion in a consolidated appraisal action arising out of Verizon Communications Inc's 2015 acquisition of AOL Inc. In contrast to a recent string of Delaware appraisal decisions, the court determined that reliance on the $50 per share merger price for determining AOL's statutory fair value was not warranted.

Delaware's amendments apply market-out exception to appraisal rights for Section 251(h) mergers
Ropes & Gray LLP
  • USA
  • 03 April 2019

Delaware Governor John Carney recently signed into law amendments to the Delaware Limited Liability Company Act and the Delaware General Corporation Law. Notably, the amendments expand the application of the market-out exception to appraisal rights, which has long been applicable to 'long-form mergers', to also include 'medium-form mergers'.

Court provides guidance on applicability of transaction price as measure of fair value
Ropes & Gray LLP
  • USA
  • 27 March 2019

Two Delaware appraisal decisions issued in 2018 illustrate that, following the Delaware Supreme Court's decisions in Dell and DFC, the Delaware courts remain willing to give substantial evidentiary weight to a deal price as an indicator of fair value where the underlying transaction is the product of an open process characterised by the objective indicia of reliability.

Squeeze-out mergers in Turkey – an overview
Kayum & Demir
  • Turkey
  • 20 March 2019

Squeeze-outs in Turkey are regulated under the Commercial Code where they concern private companies and the Capital Markets Law where they concern publicly held companies. This article examines the different processes for carrying out squeeze-outs at private and publicly held companies, as well as the squeeze-out rights available to controlling shareholders and the squeeze-out merger process.

Chancery Court applies MFW framework in private equity merger transaction
Ropes & Gray LLP
  • USA
  • 13 March 2019

A recent decision applied the framework established by the Delaware Supreme Court in Kahn v M&F Worldwide Corp (MFW) and found that a merger transaction with a controlling private equity fund on both sides was entitled to business judgment review. The decision outlines the elements of the MFW roadmap and clarifies that its ab initio requirement requires only that the elements be in place prior to the commencement of negotiations.

M&A opportunities in Cyprus post-Brexit
  • Cyprus
  • 27 February 2019

There has been a noticeable rise in foreign investments in Cyprus, with an upswing in mergers, acquisitions and joint ventures. This has been the result of various reforms and legislative amendments that have added legal certainty and contributed to the creation of a coherent statutory framework. International investors might well consider these factors when assessing Cyprus as an investment hub for future transactions in the M&A market post-Brexit.

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