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Michael Mercurio’s Anatomy of the M&A Deal

Whichever side of an M&A transaction you find yourself on, corporate attorney Michael Mercurio has your back. As chair of Offit Kurman’s Business Law and Transactions Practice, Mr. Mercurio counsels clients during every stage of their business’ life cycle, from formation and management to transfers and expansions. Entrepreneurs and executives laud Mr. Mercurio’s practical guidance, his ability to broker corporate transactions swiftly and profitably, and his breadth of knowledge on the finer points of business ownership and transition. For several months, Mr. Mercurio has been publishing in-depth articles about the key points during an M&A deal from the sell-side perspective. This past September, he was also a featured panelist at Offit Kurman’s Prepping the Deal seminar. If you were not able to attend the event, and have missed Mr. Mercurio’s write-ups so far, catch up with the first four entries and related video excerpts below:

Part I: The Importance of Pre-transaction Planning Before Selling Your Business

Data collected by Securian Financial Group suggest only about a fourth of business owners have formalized an exit strategy. As Mr. Mercurio writes, “failure to plan not only poses significant risk, but a lost financial opportunity.” How you prepare prior to a transaction sends a message to a potential buyer, and it is imperative to ensure that message communicates commitment to the deal. Click here to read Mr. Mercurio’s pre-transaction game plan. Prepping the Deal: Commitment

 

Part II: 3 Key Provisions in a Mergers and Acquisitions Letter of Intent

M&A deal-making starts in earnest with a letter of intent (LOI). Because it serves as the initial basis for negotiations between buyer and seller, an LOI is typically thorough and carefully crafted. It is almost never, however, legally binding and does not amount to final terms of a sale. Sellers should be careful to heed Mr. Mercurio’s advice: “You have not sold your business until you have sold your business.” So what can you expect from an LOI? Find Mr. Mercurio’s answers here. Prepping the Deal Excerpt: Preparation

https://www.youtube.com/watch?v=azj-QFu8gS

 

Part III: 8 Line Items to Expect in Any Due Diligence Checklist

Once a seller and buyer agree to the LOI, the due diligence process begins. Your buyer will want to learn as much about your business as possible, and it is up to you to make all necessary measures to accommodate the ensuing investigation. Besides assuaging the buyer’s fears, getting ready for disclosure also means taking stock of your company’s state of affairs: what you own, what questions remain, and what skeletons in the closet you can mitigate or eliminate. Before you take the next step, make sure to familiarize yourself with Mr. Mercurio’s list of common line items on a due diligence checklist. Prepping the Deal Excerpt: Know What You Own

Part IV: Top Considerations for M&A Negotiations

Reps and warranties, indemnities and escrow, earnouts, adjustments—for anyone new to M&A transactions, the language used in contract negotiations can seem overwhelming. While legal counsel can help you navigate the complex waters of negotiation, it is crucial for sellers to understand the considerations endemic to mergers and acquisitions for themselves. Armed with an atlas to the conversation, sellers can make informed choices about when to give and when to take in order to secure a mutually beneficial agreement. Learn how to gain an advantage at the discussion table with Mr. Mercurio’s guide to negotiations, available here. Prepping the Deal: Bump in the Road

 ABOUT MICHAEL MERCURIO

Mike_Mercurio_WebsiteNEWMr. Mercurio is a Principal and Chair of the Firm’s Business Law and Transactions’ Practice Group. He serves as outside general counsel to clients on matters related to corporate and business law, commercial transactionsgovernment contracting, technology issues and real estate. As a strategic partner to firm clients, Mr. Mercurio regularly counsels entrepreneurial individuals and assorted entities on all aspects of business and commerce including formation and structure; ownership, management and control; financing and capital; expansion and acquisition; sale and transfer; and contraction and dissolution. He is well versed in the various issues and challenges companies of all sizes and industries face in the business life cycle including start-up, maturation and end stage considerations. A core specialty practice for Mr. Mercurio is mergers and acquisitions, both from the sell side perspective and buy side perspective.

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