Even in mergers that appear to be flawless, unforeseen issues can arise. Because of this, it is imperative that you utilize the services of a reputable attorney who specializes in the field of mergers and acquisitions. For this, you need someone with years of experience and expertise specific to state and federal laws for merger transactions. This will keep your company’s best interest protected.
Why You Need the Right Attorney
The work performed by a merger and acquisition attorney is quite integral. Regardless of the type of deal, whether a negotiated merger, hostile transaction, stock acquisition, or something else, having a qualified attorney in your corner is essential.
Remember, each type of merger is unique because different laws apply. A prime example is that in the United States, mergers and acquisitions are reviewed and approved by several agencies, including the Department of Justice, the Securities and Exchange Commission, and the Federal Trade Commission. That alone is intimidating to the layperson, but a qualified attorney has a clear understanding of the governing regulations and rules.
The right attorney will make sure that all legal documents created by you, such as asset agreement, confidentiality agreement, letter of intent, and closing transaction agreement, conform to relevant rules and regulations on a state and federal level. Without that professional eye, critical things might be overlooked.
Throughout the entire merger process, your attorney is always making decisions that benefit you and your company. As part of this, you will be notified of anything that raises concern. There is no question that state and federal laws governing mergers, as well as acquisitions, are quite complicated. To get all the necessary approvals from the different government agencies, investors, and stockholders, you need an attorney with experience, patience, and know-how.
Common Merger Problems
Again, with their experience and expertise, your attorney will be aware of potential risks and therefore avoid or mitigate them.
- Poor Intentions—A merger needs to be a smart business strategy more than something that strokes the ego. When you meet with a qualified attorney, they will review all pertinent details to confirm that a merger makes sense.
- Lack of Knowledge—After going through a prior merger, some people think they have tremendous knowledge and therefore do not need to follow everything the attorney suggests. In reality, a second merger or acquisition is often more challenging. Because there are differences in every merger, you cannot assume that the second deal will work exactly as the first. This is why you need to rely on your attorney’s wisdom and know that every merger should be treated independently.
- Standing on Your Own—In looking around, you will notice a significant number of mergers. Unfortunately, once a company within a specific industry goes through a merger, it is common for other companies within that same industry to follow suit without first determining if a merger is the right action. An attorney will help you avoid making this mistake by determining if your company is ripe for a merger or if you should wait for a more opportune time. Just because other companies are merging does not mean that you should,
The Bottom Line
Merging companies takes time and extensive knowledge of state and federal laws. If you are interested in a merger and want everything to go as smoothly as possible, you need to work with a reputable merger and acquisition attorney. The result will be a more seamless deal that favors your company.