Finding a target webinar
Gideon Franklin was a guest speaker at a joint webinar on the topic “M&A – How to find a target”, co-hosted by 3CS Corporate Solicitors and Greenback Alan LLP, chartered accountants. The webinar took place on 17 June 2021 at 09:00-10:00 in Japanese, participants being Japanese companies in Europe and Japan. There were four key topics.
- Identification – Routes include research, auction process, existing relationships and introductions
- Approaching – Preparation and arrangements, including internal buy-in.
- Letter of Intent signature – Key factors for success
- Replies to the most frequently asked questions by clients on both tax/financial and legal aspect
The presentation by Gideon Franklin had a focus on M&A practicalities, for instance in the identification phase a list of items to check in a teaser and key points in a process letter. We highlighted how a point of confusion can be between the definition of equity value and enterprise value – stressing that there needs to be clarity on this at an early stage.
When it comes to approaching, we suggested necessary information to provide advisors to maximise the chance of success. We described how a cold call needs to be carefully planned and how in several cases an appropriate form of approach could be at an event such as an industry trade fair.
Letter of intent signature is the point at which the approach becomes real, and for this purpose a lot of attention needs to be given to the internal buy-in from corporate planning, finance and operational divisions, also maybe non-executive directors. We highlighted formats and options for what to include, also recommending assessment of the impact of goodwill at this early stage.
Hiroko Mitomi, the speaker for 3CS, structured her presentation around 10 questions commonly asked by clients from a legal perspective in this phase of an M&A transaction, detailing the role that the lawyer plays to help ensure necessary steps are being taken to conserve confidentiality and that antitrust rules are not being breeched.
Yusuke Takanishi, the speaker for Greenback Alan, talked about points of care from an accounting point of view, illustrating with a case study how significant cost savings can be made if preparation is done early. Topics covered included tax considerations, treatment of intangible assets and a share purchase versus an asset purchase.
In the ensuing Q&A, Keith McAlister (3CS) and Jo Fisher (Greenback Alan) joined the panel to share their experience in what everyone agreed is a critical stage to determine the success of any M&A process, setting the right level of expectation from the start.
3CS Corporate Solicitors
Hiroko Mitomi Solicitor / Managing Director
Keith MacAlister Corporate / Commercial Lawyer / Director
Greenback Alan LLP
Deputy Managing Partner