Financial conditions of M&A transactions

Turbulent times result in changed methods and conditions in relation to company acquisitions. Knowledge was shared and new networks established when this year's M&A conference was held at Horten.

In cooperation with the Swedish law firm Vinge and the German law firm RWP, Horten brought together a number of European attorneys for this year's M&A conference held from 19-21 October 2012. The conference was held at Horten and Vinge where selected experts introduced the guests to the latest trends within M&A.

The theme of this year's conference was trends within the financial conditions of M&A. The conference described the most significant challenges and possibilities in the wake of the financial crisis. "The high quality level of the contributions exceeded my expectations", says Lise Lotte Hjerrild, partner at Horten, elaborating that, "it was obvious that great efforts had been made by each individual speaker. In addition, focus was within a relatively limited legal area so all topics were touched on".

The art of trinity

On of the highlights of the conference was the trinity of M&A. A successful company acquisition requires that the financial, commercial and legal aspects form a synthesis; an achievement which requires solid coordination and advice.

The financial crisis has entailed uncertainty with respect to valuation, future results and thereby the expected return. There is therefore a tendency towards an increased use of earn-outs and closing accounts rather than fixing of the purchase price (locked box).

Cultural barriers

In addition to these more technical perspectives, the cultural barriers were also emphasised as an important, yet often overlooked, part of the M&A process. Company acquisitions are complicated per se, but when taking place across borders, it is often experienced that language and culture become new and unknown variables. The 85 guests from 25 different countries were familiar with these cultural challenges.

As a new aspect, it was also emphasised that this experience relates not only to cross-continental transactions with e.g. Chinese parties where the language barrier is still pronounced despite an increased education level, but also to inter-European contexts.

Sunshine, coffee and networking

In-between the lectures, the doors were opened, enabling the participants to enjoy the warm autumn sunshine, a good cup of coffee and an inspiring spirit of community. Lise Lotte Hjerrild says that the most important aspect of any conference is the possibility of networking. And she adds that substantial resources had been spent on facilitating this to provide the guests with not only new knowledge, but also new or strengthened international relations - in which connection the bus ride to Malmö, conference dinners, wine tasting and a trip to Tivoli were instrumental.

"It was an excellent networking opportunity", Lise Lotte Hjerrild concludes. "The social and professional expectations were fully met judging from the participants' feedback, because highly qualified people had devoted time in their business schedule to contribute actively to this exchange of experience".

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Lise Lotte Hjerrild

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