Conversation on W&I Insurance in M&A Transactions
As an M&A lawyer with a keen interest in the nuances of the M&A field, I’ve observed that warranty and indemnity insurance (W&I) is not that common in M&A transactions in Malaysia, as far as I know. Therefore, when I saw Martijn de Lange of BMS Group commenting about W&I …
Indirect Substantial Shareholder
A person can be a substantial shareholder in a company without directly holding any shares in that company. One of the challenges that often arises when I work on IPOs or other equity capital market exercises is the assessment of whether an individual holds an indirect substantial shareholding in a …
Legal Requirements for Directors’ Fees and Benefits in Malaysia
One common issue I encounter in both M&A deals and IPO exercises relates to compliance with the legal requirements for the payment of director’s fees and benefits. Additionally, the legal obligations regarding director’s service contracts should not be overlooked. Here are the key points: Constitution 1. If a company, whether public …
M&A: Earn-out vs. Performance Guarantee
I find that clients and other advisers sometimes confuse the concepts of an earn-out with a performance guarantee. They tell me they want a performance guarantee clause in the sale and purchase agreement, but upon further probing, it becomes clear that what they actually want is an earn-out clause. Both …
When to use (and not to use) earn-outs in M&A transactions
When I first learned about the concept of an earn-out mechanism in M&A transactions, I thought it was an absolute good idea. An earn-out bridges the gap between the seller’s and the purchaser’s perception of the value of a target company. If the target company achieves the agreed metrics or …
Rejection
I started reading “Rejection Proof: How I Beat Fear and Became Invincible Through 100 Days of Rejection” by Jia Jiang recently. I figured I would be a happier person and a more resilient lawyer if I could handle rejection more constructively. As I delved into the book and began reflecting …
M&A: What you need to consider for sale and purchase agreement
Before diving headlong into drafting the sale and purchase agreement for an M&A transaction, take some time to understand the business of the target company and the regulatory framework in which it operates. Consider the following: 1. 𝗕𝘂𝘀𝗶𝗻𝗲𝘀𝘀 𝗔𝗰𝘁𝗶𝘃𝗶𝘁𝗶𝗲𝘀: What are the business activities of the target company? What products or …
Five key steps for legal due diligence
Most lawyers are good at identifying issues, but legal due diligence shouldn’t be limited to merely reviewing documents and identifying issues. Here are my five steps for conducting legal due diligence: 1. Identify the issues based on the scope of legal due diligence as agreed with the clients. 2. Provide recommendations …
Begin with the end in mind: Post-completion integration
I once worked on an M&A deal that took more than a year to complete. While the deal was not inherently complex, it dragged on due to delays in finalizing the details of the transaction agreements for reason beyond my control. As the deal involved a larger corporation acquiring a …
Being a Corporate Lawyer: Why I Do What I Do
After years of demanding schedule and juggling simultaneous corporate exercises which take a toll on physical and mental health, it is not surprising that some corporate lawyers experience burnout. Unlike some legal practice areas, the work of a corporate lawyer may not seem immediately impactful or “make a difference” to …