With our globalized world, it is vital to formulate a fast and effective development strategy to reach into global market. New projects or offices are just one device for growth – and not inevitably the fastest or the most cost-effective. Mergers or acquisitions can prove a more effective option, if there are existing companies in the region.
Mergers and acquisitions are an effective strategy for companies to increase their business operations beyond national borders exclusive of expending the time or resources needed to create foreign corporate offices or start wholly owned subsidiaries. In a merger or acquisition, prevailing market players are joined with the company – either by folding one within the other or merging the two at every level.
Mergers and acquisitions can also be a instrument for diversification, development or consolidation. Using these dealings, companies can modify the nature of their business, multiply their sphere of influence, condense their operations, or expand along the service chain. It is an vital part of corporate business practices and will remain to develop with the growing competition in the international market.
Mergers or Acquisitions
When choosing a merger or acquisition, it is essential to understand the function of each and the differentiation between the two.
Mergers involve the blending of two business entities into a third, new organization. This is a intricate model, which involves the restructuring of the companies at a basic level – and involves the adaptation of both parties as well as the creation of a new, joined organization. Negotiations and documentation of a merger is similarly complex and require the greatest of care and caution to execute.
On the other hand, acquisitions involve the complete absorption of one company into another. Although the fallout from an acquisition might become as complex as that of a merger, the process is much simpler. In this process one company is completely dissolved – its assets, staff, and obligations being reassigned over to the other.
Usually, an acquisition is the better choice for companies of varying sizes and resources. But with companies of equal standing, they would be better served by a merger.
An Intricate Process
Several spheres of expertise and law are involved, whether choosing a merger or acquisition. The process involved is intricate and involved.
Analysis: The first stage towards a merger or acquisition is identifying the right target. This incorporates finding a target of the right size and scale in the industry, recognizing which form of joinder should be used, and proper due diligence of the prospective partner. Our skilled attorneys can help through this step, to get your merger or acquisition off on the right foot.
Negotiation: Starting with offers to be binding agreement contracts involves several intricate details and negligible variations of law that can have major consequences on the sustainability of the organization after execution. Deliberating these details, handling proper valuation, and confirm full compliance with applicable laws can prove tricky and time-consuming for an organization.
At Kashyap and Kashyap, our attorneys can help through the negating process. This comprises drawing up a list of enforceable terms, and thoroughly negotiating with opposing counsel to get you the best deal you can get.
Drafting: After you have an agreement, the deal still must be solemnized into a binding investment contract. While you may think the deal settled, it will be tough to hold the other party to the agreed upon terms. Getting from an offer or agreement, to a binding contract can be tricky. We can help – by drafting a contract that communicates the totality of your agreement, in a form carefully tailored to protect your interests and within the limits of the law of the land.
Execution: When an investment contract is negotiated and written, it still must be executed to become binding. Furthermore, the corporate documentation of both parties must be transformed and re-executed in order to reflect the merger or acquisition. Our attorneys work to enable the execution of contracts across borders, to ensure that the necessary formalities for all appropriate jurisdictions are met to solemnize your agreement and make it enforceable.
We Can Help!
All companies involved in mergers and acquisition transactions need experienced legal guidance to ensure a fair-minded, secure and beneficial transaction. We have panel of internationally trained and practiced experts to develop a clear and effective merger and acquisitions strategy to ensure a beneficial and effective transaction for our clients.
Our offices use only the most selected and qualified corporate lawyers available, trained and licensed in both the US and India. We provide these legal services through our New Delhi and Gurgaon offices, online, as well as in-person, onsite visits for larger international corporations.