Tag archives: M&A

The tech takeover: disruptive technology as a driver of M&A

A relentless parade of new technologies is unfolding on many fronts – one of which includes the M&A scene. While not every emerging technology will alter a business’ landscape, certain technologies have the potential to disrupt the status quo, alter the way companies operate and rearrange value pools. These “disruptive technologies” can quickly displace established … Continue reading

Regulatory reform signals potential spike in M&A activity involving US financial institutions

On March 14, 2018, the US Senate voted (67-31) to advance S. 2155, the Economic Growth, Regulatory Relief, and Consumer Protection Act (the Bill). The Bill, which will only become law with approval from the House and Congress, marks an unprecedented, bipartisan compromise to ease banking rules enacted following the 2008-09 financial crisis. If enacted, there may soon … Continue reading

The risks of sealing the deal with a personal guarantee

The purchase and sale of a business can involve a plethora of financial risks – one of which is often mitigated by requiring a personal guarantee. In the private M&A context, personal guarantees can have important implications for the buyer, who is signing the guarantee, and the seller, who requires the guarantee. These implications become … Continue reading

U.S. banking M&A on the rise and may extend to Canadian financial market

According to a recent article published by Pitchbook, this year has already shown a positive momentum for deal-making in the U.S. banking industry – a trend worth monitoring as it is expected to surge further as the year progresses and U.S. banks (especially those that already have a Canadian presence) may be looking to acquire … Continue reading

Offer of continued employment with buyer does not absolve seller from liability in M&A transactions

A recent decision of the Ontario Superior Court of Justice, Dussault v Imperial Oil Limited, 2018 ONSC 1168 (Dussault), provides a cautionary tale to selling parties in an M&A transaction who intend to limit liability for wrongful dismissal by negotiating for its employees’ continued employment with the buyer. The Dussault decision illustrates that even when … Continue reading

Better, faster, stronger: revamping the M&A due diligence process with Artificial Intelligence platforms

Voluminous information in M&A transactions M&A transactions can be time-intensive, often involving contract discovery and analysis, due diligence, data room preparation, verification of representations and warranties, privacy issues and multijurisdictional privacy legislation and intellectual property protection, among other important aspects. As deals become larger in value and scope, the review and analysis of the foregoing … Continue reading

Baskets and caps: limits to indemnification obligations

Indemnification provisions are among the most highly negotiated provisions in private M&A transactions. These provisions set out the terms and conditions under which one party will be required to indemnify the other party for any losses the other party may suffer post-closing. In other words, indemnification provisions set forth the “rules of the road” and … Continue reading

Global automotive M&A ends 2017 in high gear with no signs of slowing down

As seen in this recent PwC article, global automotive M&A activity was strong in 2017.  Automotive deal value increased 29.9% to $53.2b from 2016 to 2017 primarily as a result of two mega deals in the Auto-Tech sector, which PwC defines as “investments in connectivity, autonomous, electrification, ride-sharing and the software, sensors, intellectual property and … Continue reading

Legal update: common interest privilege in commercial transactions

On March 6, 2018, the Federal Court of Appeal reversed the decision of the Federal Court of Canada in Iggillis Holdings Inc v Canada (National Revenue). As we discussed in a previous post, the trial court decision in Iggillis Holdings had called into question the availability of common interest privilege in commercial transactions. The trial … Continue reading

Cross-border agreements and the choice of governing law

In order to meet the demands of a constantly evolving global marketplace, companies often seek to expand their operations through cross-border mergers and acquisitions. When pursuing an international transaction, the parties must consider a unique aspect of the deal – the legal framework in which the deal and any contractual agreements within it are to … Continue reading

Inherited liability under a workers’ compensation system: a surprise to avoid

Canadian provinces and territories all administer some form of a workers’ compensation system within their jurisdiction. Funded by employer-paid premiums, these no-fault insurance systems provide wage replacement and medical benefits to injured employees who relinquish their right to sue their employer for losses arising from their injuries. In Ontario, for example, the relevant legislation is … Continue reading

Working capital adjustments: lessons from De Santis and Iacobucci v Doublesee Enterprises Inc.

In complex M&A transactions, there could be a significant delay between the initial valuation of a target company and the closing of the deal. As we explained in our previous article, “Net working capital adjustments: what’s the deal?”, parties can protect themselves against fluctuations in value during this period by negotiating purchase price adjustments (PPAs). … Continue reading

Cybersecurity update: from transaction start to finish

Cybersecurity has never been more critical. This growing area of concern has been on the mergers and acquisitions (M&A) radar for some time, and we’ve previously blogged on its effect on the due diligence process, regulatory requirements, and overall acquisition risk assessments. With only 4% of organizations reportedly agreeing that their current cybersecurity strategies had … Continue reading

Legal update: M&A in the pharma sector

Of counsel James Baillieu explores the pharma M&A horizon in PharmaTimes magazine. The pharma sector saw deal activity fall in 2017 compared to previous years. While the number of deals remained robust, their value was significantly lower due to fewer large acquisitions. Looking ahead, however, many expect deal levels to pick-up as Trump’s tax reforms … Continue reading

Investor confidence, disruption risk and US tax reform will continue to spur M&A activity

JP Morgan recently released its 2018 Global M&A Outlook report, predicting that 1) investor confidence from solid GDP growth, 2) disruption risk from technological change, and 3) opportunities from the passing of the US tax reform will drive significant M&A activity in the year ahead. Investor confidence In 2017, nine out of ten equity sectors … Continue reading

“Two’s company, three may be a crowd”: the importance of considering third-party beneficiaries

In a typical M&A transaction, the vendor and the purchaser are front and centre stage. The spotlight is focused on the parties to the transaction, the negotiations and “papering” the deal. However, together with their respective counsel, the vendor and purchaser must also consider the role of third-party beneficiaries. Who is a third-party beneficiary? To … Continue reading

2018 merger review thresholds for Competition Act and Investment Canada Act

The threshold for certain pre-closing net benefit reviews under the Investment Canada Act (ICA) and the threshold for a pre-closing merger notification under the Competition Act have been increased for 2018. Competition Act Canada uses a two-part test for determining whether a pre-merger notification is necessary. The two-part test is based on the size of the parties and the … Continue reading

Federal government creates new Ombudsperson to oversee corporate activity abroad

On January 17, 2018, the federal government announced two new initiatives relating to the oversight of Canadian companies doing business abroad. The first initiative is the creation of an independent Canadian Ombudsperson for Responsible Enterprise (CORE). The mandate of the CORE will be to investigate allegations of human rights abuses linked to Canadian corporate activity … Continue reading
LexBlog