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Skillfully Negotiating Mergers And Acquisitions

A merger and acquisition transaction may be structured as an asset purchase, stock purchase or merger transaction. Furthermore, the transaction may involve the full acquired business or it may be structured to acquire only a part of the business.

Our Texas-based attorneys at HPK are knowledgeable in negotiating merger and acquisition strategies. We will assist you in seeing all of your options to ensure you are set up for success in the long run.

Understanding The Types Of Mergers And Acquisitions

Understanding which type of merger or acquisition will best support your long-term strategy requires a careful look at the pros and cons and the support of an expert advisor for guidance. Considering the parties involved in the transaction, mergers and acquisitions can be generally classified as:

  • Vertical (parties supplying different points on the supply chain)
  • Horizontal (similar products and services)
  • Concentric (shared customers)
  • Market-extension (such as serving different geography)
  • Conglomerate
  • Product-extension (adding products or services)

The benefits of each vary, and depending on your strategy these could include building economies of scale, increasing market share, decreasing competition, boosting efficiencies, expanding product lines or diversifying offerings. There are also, however, negative connotations associated with these business transactions which should also be carefully considered such as possible lack of synergies, varied cultures, overlap in expertise, cost of consolidation, assumption of liabilities, duplicative suppliers, vendors and contracts, and whether the transaction will be accretive or a dilutive transaction and many more such issues.

Advocating For Both Buyers And Sellers

Merger and acquisition transactions tend to favor the buy-side business that proposes to acquire the sell-side acquisition target. This is often due to the larger size and the opportunity to exercise leverage inherent in bringing liquidity to a prospective capital transaction. The larger acquirer, also, often enjoys the advantage of greater experience in similar capital transactions. We have experience representing either party in an M&A, giving us the insight to negotiate to your advantage.

Discuss Your M&A Today

Whether you are on the buy-side or the sell-side, we can assist you in facilitating a favorable transaction. To request an initial consultation with one of our lawyers, please contact our office location in Austin. Send us an email or call 512-768-9337.