6 Key Responsibilities Of Mergers And Acquisitions Lawyers

Mergers and acquisitions is an important aspect of the business world. Irrespective of whether the economy is growing or there is a slowdown, mergers and acquisitions in india happen regularly. Generally a bigger company acquires a smaller company. Mergers happen when two companies with business synergies come together to continue their operations. Both the involved companies have their own lawyers who advise them throughout merger and acquisition process.

Roles of Mergers and Acquisitions Lawyer

ADVISOR

The primary role of merger and acquisitions lawyer is to serve as an advisor. They assess the financial situation of both the companies involved in the transaction. They must ensure that the companies are financially sound and that all corporate records are maintained. They have to make sure that their clients get the best deal under the prevailing circumstance. If they find any red flags they should notify their clients about it and let them decide whether the deal is worth pursuing. They must also advice and apprise the clients about the progress in the transaction.

MEDIATOR

Lawyers are not the only professional involved in M&A transactions. There are financial advisors, banks, real estate brokers, and other professionals whose services are needed to complete the transaction. Though every professional has his/her defined role in the entire process, it is generally the lawyer who is the coordinator and acts as the central contact point. Every development in the transaction process goes to the lawyer for review who then decides whether to approve or not. The M&A lawyer is the intermediary between the company and the other professionals engaged in the deal.

NEGOTIATOR

An important part of mergers and acquisitions lawyer is that of negotiation. Though many people believe that lawyers are only good at arguments, but M&A lawyers are good negotiators as well. It’s their job to ensure that deal is done through as it was intended to at the outset. They have to negotiate with opposing lawyers and other professionals with respect to the desired terms and conditions for the deal. Though majority of the terms and conditions are decided upon at the beginning, negotiations happen throughout the transaction process as each party bargain for a better deal. A lot of compromises have to be made in the process.

DRAFTER

There is a lot of documentation that is required in M&A deals, such as contracts, term sheets, registration, Government applications etc. There are many other important documents that need to be drafted as well. It is the responsibility of the M&A lawyer to draft these documents. Generally, there is not just one lawyer attached with transaction, but a battery of lawyers from top law firms in india or even more than one law firm. Lawyers have their specialties in different aspects of the M&A process so, there could be more than one person involved especially in drafting. Since the language is very important to avoid future dispute, so utmost care should be exercised in drafting of documents and should also be reviewed many times to eliminate any mistake.

TAXATION

M&A lawyers also advise companies on matters of tax implication if the deal goes through. There could be potential tax liability that may arise for the acquired company because of the possible windfall gains made by the sale. Similarly, mergers and acquisitions in India can change the structure of the acquiring company which can result in differ tax obligations. For instance, in family businesses, there is huge tax obligation on the shareholders who sell their stake. It is the responsibility of M&A lawyers to help these shareholders to do advance planning to avoid any future difficulty.

LEGAL ASPECT

Merger and acquisition lawyers are responsible for all legal aspects of the deal. It is their responsibility to ensure that all regulatory compliances are met in mergers and acquisitions in India. They have to see if any of the merging companies or the target company is engaged in any kind of legal dispute, such as real estate dispute, tax dispute etc. They have to ensure that the transaction is done within the ambit of the law and that the rights of none of the stakeholders are compromised. The above mentioned roles are the key responsibilities of mergers and acquisitions lawyers. In short, the lawyers play a very crucial role in mergers and acquisitions in India. They are the central figure in the entire transaction process.