One of the objectives in M&A due diligence is to ascertain that the seller has good title to the seller’s shares in the target company. This include verifying whether any charges or encumbrances have been created over those shares. Three ways to do this: 1. Include questions in the legal …

Assessment of a candidate for the role of an independent director of a public listed company (“𝗣𝗟𝗖”) is important and requires extensive due diligence, in particular for a company which is undertaking an IPO exercise. The following are 3 things to consider when assessing a candidate for the role of …

Non-declaration of director’s interest in contracts is a common issue encountered when reviewing directors’ resolutions in the course of legal due diligence for M&A or IPO exercise. 𝗖𝗼𝗺𝗺𝗼𝗻 𝘀𝗰𝗲𝗻𝗮𝗿𝗶𝗼 X is a director and shareholder of Company A as well as Company B. Company A and Company B enter into …

Shareholders’ agreement is a common agreement in an M&A transaction where there is more than one shareholder in the target company after completion of the transaction. The following are three requirements under the Companies Act 2016 of Malaysia (“𝗖𝗔”) to take note of when preparing a shareholders’ agreement: 1. Save …

Early in my career, an investment banker asked me how to calculate the number of days specified in a sale and purchase agreement for an M&A transaction. The agreement required Party A to do something not later 30 days from [specified date]. Does the 30 days include the specified date …

When conducting legal due diligence on contracts entered by a target company in an M&A transaction, the following are some of the provisions to look out for in the contracts: 1. Whether the counterparties may unilaterally terminate the contracts or terminate the contracts upon certain events triggered by the M&A …

Practical empathy. 𝘛𝘩𝘦 𝘴𝘬𝘪𝘭𝘭 𝘰𝘧 𝘶𝘯𝘥𝘦𝘳𝘴𝘵𝘢𝘯𝘥𝘪𝘯𝘨 𝘵𝘩𝘢𝘵 𝘱𝘦𝘰𝘱𝘭𝘦 𝘥𝘰𝘯’𝘵 𝘬𝘯𝘰𝘸 𝘸𝘩𝘢𝘵 𝘺𝘰𝘶 𝘬𝘯𝘰𝘸, 𝘥𝘰𝘯’𝘵 𝘸𝘢𝘯𝘵 𝘸𝘩𝘢𝘵 𝘺𝘰𝘶 𝘸𝘢𝘯𝘵, 𝘥𝘰𝘯’𝘵 𝘴𝘦𝘦 𝘸𝘩𝘢𝘵 𝘺𝘰𝘶 𝘴𝘦𝘦. 𝘛𝘩𝘦𝘺 𝘩𝘢𝘷𝘦 𝘢 𝘯𝘰𝘪𝘴𝘦 𝘪𝘯 𝘵𝘩𝘦𝘪𝘳 𝘩𝘦𝘢𝘥 𝘵𝘩𝘢𝘵’𝘴 𝘥𝘪𝘧𝘧𝘦𝘳𝘦𝘯𝘵 𝘵𝘩𝘢𝘯 𝘵𝘩𝘦 𝘯𝘰𝘪𝘴𝘦 𝘪𝘯 𝘺𝘰𝘶𝘳 𝘩𝘦𝘢𝘥 𝘢𝘯𝘥 𝘵𝘩𝘢𝘵’𝘴 𝘰𝘬𝘢𝘺. I heard Seth Godin mentioned something along these lines …

When structuring an M&A transaction, consideration should be given to laws relating to financial assistance which may have impact on the financing of the transaction. The laws of Malaysia relating to financial assistance is summarised below: A seller is not prohibited to provide financing to a buyer. The assets of …

1. Understand the scope of legal due diligence and work backward to establish what needs to be verified or reviewed. Sometimes, clients may decide on the scope of legal due diligence. For corporate exercises which require regulators’ approvals, the scope of legal due diligence must meet the requirements under the …

A purchaser typically requires a seller to give indemnities and warranties to safeguard the purchaser’s interest in a share or asset purchase agreement. From the purchaser’s perspective, there are some advantages of having indemnities over warranties, including the following: 1. The seller may be able to avoid liability under warranties …