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Common Business Mergers Issues
April 08, 2022
Preparation, strategy, and negotiation structuring that anticipate potential challenges and concerns are the keys to most successful Mergers and Acquisitions (M&A).
Identifying and addressing these present legal challenges ahead of the deal with your Tampa business lawyers is critical to success.
Domestic Mergers
Common issues when merging domestic businesses in Florida include :
- Choosing the wrong company to target
- Excessive reliance on synergy
- Overpaying
- Risks that originate outside of the system
- Losing the confidence of key stakeholders
- Poor due diligence
- Ignoring the red flags
- Failed Integration
- prioritizing the wrong factors
International Mergers
Common issues when merging businesses in Florida with international companies include:
Due Diligence: Lack of research causes delays, waste of time and money
Issues of Antitrust and Competition: May arise if a non-US acquirer directly or indirectly competes with the target company or owns a stake in a company that does
Political Factors: Check for possible political ramifications
US Law Compliance: Making deals in the United States is difficult for non-US firms, as is integrating after that
Transaction Design: It’s critical to explore a range of transaction structures
Client-attorney Privilege: Unlike the US attorney-client privilege, privilege norms vary widely among countries and might prove disastrous
Labor and Employment: Cross-border labor and employment issues could get complicated due to variances in local jurisdiction regulations or conventions and practices
Tax and Accounting Issues: Tax issues usually dictate transaction structure
Post-Closing Issues: Diverse cultures, languages, and business practices
Before Merging
- Compare and contrast the corporate hierarchies
- Determine the company’s leadership.
- Analyze the differences between the corporate cultures
- Determine the company’s name and logo
- You should examine all financial positions
- Calculate the costs of operation.
- Make a thorough investigation of the situation
- All companies should be valued
How Florida’s Short Form Merger Provision Plays a Role in M&A
To move through with a deal, a smaller percentage of its shareholders must approve it in structure.
Since the goal of every transaction is to close as quickly as possible, this expedites the process for both buyers and sellers.
How Your Business Attorney in Tampa can Help
Companies merge all the time, but the process can be time-consuming and difficult.
Numerous factors require consideration to ensure that the process goes smoothly.
They include monetary, regulatory, and structural concerns. Consult with a Tampa business litigation attorney at The Law Office of Robert Eckard & Associates, who has expertise merging businesses like yours.