Friday, December 3, 2010
It's December, time for law firm reviews of the deal year that was. Here's Paul Weiss' contribution (24 pages). This study includes a survey of the largest 25 transactions from August 2009 through July 2010 (year 3 in charts below). In general, private equity buyers have continued to stay away, while strategic buyers (with cash) have continued to make acquisitions - albeit at a slower rate. In keeping with this blog's interest in reverse termination fees, the following chart from the report is interesting:
Looks like a significant increase in the size of the reverse termination fees in the past year. That makes sense, because there is no reason for them to be tied to the size of termination fees. It also looks like sellers have decided that it's not worth giving up specific performance as a remedy.
And, how about this:
100% of transactions surveyed in the past year have match rights. It's interesting that sellers seem to have universally given up trying to negotiate match rights out. Have they become boilerplate? I hope not. There are still reasons to believe that in certain circumstances a board might be better advised not to include such rights.