The sale and purchase agreement/share purchase agreement (SPA) should reflect the outcome of all major negotiations between the seller and buyer of a business. It is critical that it fully reflects both parties’ intentions and that all possible scenarios post transaction are considered prior to the document being finalised.
However, sometimes through design, but more often through unintended ambiguity, the original deal agreed between the seller and buyer may not translate as intended into the financial provisions of the SPA. This could put the deal at risk or result in significant value loss to a party, including the cost and distraction of resolving issues post deal.
Our SPA advisory team can help you to avoid such problems, whether you are a seller or buyer, both at the pre-deal and post-deal stage. Our expertise can also help avoid the escalation of disputes and provide support when such disputes occur.
Our experienced SPA advisory team brings together the skills of financial due diligence, tax advisory, forensic accounting and disputes specialists, together with a practical and pragmatic approach, in order to protect your position as best we can.
There are various ways that we can support you throughout the deal process.
- Offer letter and pre-SPA negotiation: Advising at an early stage on the fundamentals of the deal, on the most appropriate pricing mechanism, providing you with clarity on the issues at stake, and the reasoned arguments to maximise your position.
- SPA negotiation and review: Advising in negotiations on the accounting aspects of the SPA, including how best to determine ‘free cash’, debt and ‘debt-like’ items, and ‘normal’ working capital levels – figures that can directly impact the consideration to be paid.
- Assistance in drafting legal documents: We can assist you and your legal advisers to draft ‘locked-box’, completion accounts, and earn-out mechanisms in the SPA, as well as advising on appropriate financial and tax warranties and indemnities.
- Post-deal support and dispute resolution: Reviewing or preparing of completion or earn-out accounts and acting for you in disputes relating to these accounts, or on breach of warranty and alleged misrepresentation matters.
Our team has worked on hundreds of transactions and is able to draw on this experience and wide range of skills to provide you with expert advice, protecting your position and overcoming obstacles in the deal process.