Financial Issues in Acquisition Agreements

Course Aim/Overview

This course will mainly be of benefit to solicitors who may not always fully appreciate the financial significance of certain elements of the agreement (such as Cash free/ Debt-free deals) and for accountants who may have to provide the relevant information.

This course is available at our London campus or online.

What you will learn

• Agreeing on the valuation of the business – the options available
  • EBITDA and earnings-related valuations
  • Future discounted cash flows
  • Net asset and balance sheet valuations
• Completion accounts and completion mechanisms
  • Working capital adjustments and how such matters should be handled
  • Debt-free and cash-free – what these terms mean and what should and could be included.
  • The overlap between cash, debt and working capital
• Locked box agreements
  • How these differ from typical completion mechanisms – the advantages and disadvantages
  • Locked box adjustments for leakage and profits
• Earn-out agreements
  • How they can work and be effective
  • Common problems and how to avoid and resolve
• Current hot topics – key issues to be aware of when negotiating and marking up the SPA, for example:
• Revenue recognition
• Exceptional items and other one-off charges and income – Brexit & COVID?
• Purchase price allocation – the difference between goodwill and all other intangible items

Who is the course for?

This course will be of most use and relevance to lawyers working in corporate finance, and accountants working in-house for companies involved in mergers and acquisitions and it will be a useful introduction and overview to all professionals involved in corporate finance.

Course materials

The course will provide supporting notes and slides including examples and solutions to examples. Cross-references to important authoritative guidance and regulation will also be provided.