Transactional and Shareholder Disputes
Our services include:
Completion accounts: the majority of sale and purchase transactions employ a completion accounts methodology in order to determine the final purchase price at completion. The application of agreed completion accounts principles is frequently a source of dispute with the parties relying on a different interpretation of the SPA or prescribed accounting treatment. Under these circumstances, we assist our clients by providing supporting analysis together with a "warts and all" assessment of the strengths and weaknesses of the arguments presented.
- Drafting an objection notice and negotiating areas of disagreement
- Preparing written submissions on unresolved issues for determination by an independent expert
Earn-out disputes: we have seen a rise in the number of deals involving an earn-out mechanism in recent years as buyers are increasingly cautious about what protection to insist on should things not turn out as expected. As a result, price is becoming conditional on the future performance of the target.
Our specialist SPA advisory team works with clients to get the relevant SPA clauses right - to maximise deal value and minimise the likelihood of disputes. When disputes do arise, we assist clients with assessing the implications of earn-out mechanisms, determining whether targets have been met and quantifying the amount payable or receivable.
Expert determinations: this is a common form of dispute resolution for post-deal purchase price adjustments and offers several benefits over litigation and arbitration. Speed, lower costs, privacy and the finality of the outcome are among these benefits, while it's up to the parties themselves to manage the risks. Our specialists are frequently appointed to act as independent expert to resolve transaction disputes through the determination process.
Whether we're acting in the expert role or advising a party, we work with you to get the process right from the outset. When advising a party to the dispute, we help clients to:
- Appoint an appropriate expert, taking into account the technical accounting, commercial and industry issues at stake.
- Develop a strategy based on the information available and the strengths and weaknesses of their position.
- Prepare written submissions, review the other party's submissions and respond to information requests from the independent expert.
Breach of warranty matters: although most Sale and Purchase Agreements provide protection for buyers in the form of warranties and indemnities, seeking compensation by way of a warranty claim is far from straight-forward. If there has been a breach, early consideration of the likely cost/benefit of your claim is crucial.
We regularly advise both claimants and defendants and their legal counsel on the financial and accounting aspects of warranty claims.