Growing Trends - Why International Mergers & Acquisitions is Fundamental

In 2018, the Institute for Mergers, Acquisitions, and Alliances (IMAA) recorded a staggering 49,000 international mergers and acquisitions, totalling an impressive estimated value of $3.8 trillion.

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Notably, over one-third of this value was attributed to U.S. companies.

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Looking forward, Deloitte forecasts a surge in merger and acquisition activity, projecting a rise in both the number of transactions and the scale of deals. Their recent survey revealed that 79 percent of companies anticipate an increase in the number of international mergers and acquisitions they will finalize this year, marking a notable 9 percent rise from the previous year.

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At RHC Solicitors, we have assisted various international companies buy and merge Australian entities, the latest of which involved a U.S. and Australian world-wide events management company purchase a risk management software, which extended into employment relations and various other areas of law.

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Benefits of International Mergers & Acquisitions

There are many benefit of international mergers and acquisitions, including numerous advantages to businesses by combining resources, assets, and personnel, leading to overall improvements in various aspects of their company as well as improving cross-border relations. Some of the key advantages include:

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• Enhanced performance efficiency: by leveraging each other's strengths and eliminating redundancy, companies achieve synergy and unlock new opportunities that were not possible when operating individually

• Growth: often, the acquiring company gains not only the purchased company but also its client base, market share, and employees, which in turn provides growth opportunities without the need for extensive efforts

• Competitive advantage: Mergers and Acquisitions can enable companies to acquire competitors or significantly expand their market share, positioning them for greater competitiveness in the industry and internationally

• Increased supply: acquiring a supplier allows a company to streamline operations, cut intermediary costs, and possibly reduce shipping expenses whilst preventing competing companies access to the supply​

The Difference Between Mergers & Acquisitions

Though often used interchangeably, mergers and acquisitions are fundamentally distinct concept. Mergers often involve one company incorporating another, causing the latter to cease to exist. On the other hand, an acquisition involves a company obtaining a majority stake in another through cash sales, shares, or equity. However, the target company retains its name and legal structure.

How RHC Solicitors Can Help

When it comes to buying or selling a business or shares, expert legal guidance is essential. Our team of mergers and acquisition lawyers bring a comprehensive and business-oriented approach, drawing from extensive experience working with both buyers and sellers in various transactions, including buyouts and restructuring.

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We always prioritise your objectives throughout the process, whether it is fostering growth, facilitating an exit, or implementing a strategic restructuring.

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We have a range of experience, including:

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• Advisory services: we provide valuable advice on the most appropriate deal structures to suit your specific needs and goals

• Digital document management: our team facilitates efficient and organised document management, including due diligence solutions, to streamline the transaction process

• Document preparation: we skilfully prepare and negotiate transaction documents to ensure a smooth and legally sound process

• Warranty and indemnity insurance: implementing warranty and indemnity insurance safeguards your interests during the transaction

• Regulatory compliance: our team handles regulatory issues, including competition law and compliance with the Foreign Acquisition and Takeover Act (FIRB)

• Management and working with international legal teams: we meticulously manage the transaction from start to completion, minimising disruptions and ensuring a successful outcome, whilst also working closely with internal lawyers or legal teams

• Negotiation: as part of the process, we assist you in understanding the complexities of the documents you are faced with, including pitfalls and assist in the negation exercise so that the parties can reach an amicable solution

• Handling all facets of merger or acquisition: with various lawyers practicing in different areas, you can have the confidence that we can assist with employment relations, disputes, contract advice and preparation, commercial conveyancing and commercial leases and otherwise

• Executing and defending takeover bids: we have substantial experience in handling and assisting with takeovers