Covid-19 | Some initial corporate and finance considerations
Over the last few weeks, virtually all M&A transactions have come to a halt. In some instances, the parties opted to await the impact of the crisis. In other instances, the financing banks withdrew from the deal, or were only willing to finance at significantly more onerous conditions.
It is beyond doubt that M&A activity will be down significantly during the coming few months. However, it is also the expectation that the current crisis will create a host of possibilities as from the second half of the year, if not earlier. Whatever the outcome, the M&A market will likely be very different at the other end of this crisis, be it in terms of acquisition structures, multiples (how to calculate, for instance, normalised working capital or EBITDAs in the current circumstances), financing terms and leveraging, and transaction dynamics in general.
With decades of expertise in strategic negotiations for companies in difficulties and in judicial reorganisations, our corporate M&A team will be happy to assist you in identifying solutions. In attachment, we provide an overview of legal and strategic concerns that may be useful from a corporate and finance perspective.