Banking And Finance: Winning bid.
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The complexity of private equity buyers’ bids are putting pressure on law firms to provide more free work at bid stage, even though such bids may fail. By Richard Sharples Auction processes for European target companies and divisions attractive to private equity buyers are increasingly competitive and demanding for all participants concerned: sponsors, debt providers and professional advisers. The amount of legal work undertaken at the bid stage has increased significantly in the last year or so. Documentation, including term sheets, are generally much longer and are negotiated more heavily. More time is spent structuring deals and preparing alternative financing proposals. It is more common for full documents or interim funding arrangements to be produced, often within very tight deadlines. The main reasons for this are: * bidders demand rigorous legal, accounting and tax structuring advice and analysis from their professional advisers so as to maximise their leverage and therefore the offered price; |