As we near the end of the quarter, there is widespread concern that more companies will find themselves in varying stages of distress. These situations may force sales for some while also presenting a chance to pursue opportunistic purchases for others.
For those who find themselves considering buying or selling, it’s important for those on both sides of the transactions to keep in mind some of the key legal issues often associated with distressed situations, including successor liability, fraudulent transfers, and fiduciary duties.
Additionally, there are many transaction structures to consider and evaluate—some more common than others. For speed and efficiency, many are considering out-of-court transactions. Some are staying the course with a more conventional approach including Chapter 11 reorganization or 363 sales.
As businesses look to buying or selling as a result of distressed conditions, some additional key considerations should be kept in mind:
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Media Module - Datasource Item: Distressed MA Considerations Amid a Pandemic
Note: this presentation was part of the M&A Academy webinar series.