í´ì¸ M&Aì ë²ì ìì - Sullivan & Cromwell
í´ì¸ M&Aì ë²ì ìì - Sullivan & Cromwell
í´ì¸ M&Aì ë²ì ìì - Sullivan & Cromwell
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Recent Market and Legal Trends –<br />
Individualized Private German M&A Market<br />
Gradual structural changes in the German M&A market: from a pure buyer market<br />
(2009) to a balanced, very “individualized market” (2012)<br />
Re-introduction of certain seller friendly contractual provisions in SPA, e.g.:<br />
- Decrease in seller‘s limitation of its liability<br />
- More generous seller friendly de minimis and basket provisions<br />
- Increased number of transactions using so-called ―locked-box‖ mechanisms without purchase price<br />
adjustments to a certain record date<br />
- Growing recognition and willingness to enter into warranty & indemnity insurance as substitute for<br />
guarantees provided by the seller<br />
- However, certain buyer friendly developments can also be observed in recent past, e.g.:<br />
- Increase in non-compete clauses at the expense of the seller<br />
- Larger focus on and increase of collateral (through the use of escrow accounts, retention or bank<br />
guarantees) securing guarantee claims for the benefit of buyer<br />
Transactions tend to take longer as extensive due diligence seems to become a more<br />
common approach; aggressively conducted auction processes tend to be less<br />
common<br />
Decreasing willingness from buyers to step into competitive auctions demonstrated<br />
by rising number of (serious) requests for exclusivity<br />
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