Many years of experience in handling merger and acquisition transactions, has leads us to a conclusion that the role of a lawyer – coordinator is quite a challenge! Legal support of an M&A transactions does not consist only of a meticulous preparation of the transaction documents, but also (and mostly) of providing the client with a support in negotiating and coordinating the process, and if conducted unprofessionally, it may even lead to the failure of the entire transaction. Why?


Just before the lockdown, that resulted from the COVID-19 pandemics, the office team of Panasiuk&Partners was involved in an M&A transaction concerning taking over one of the main entities operating on the TMT market. The transaction had an international aspect, and it generated a number of additional activities related to its settlement, taking into account conditions resulting from many years of business relations between the main investors.


Those additional activities include various contracts regulating cash flows, that are an integral part of M&A processes. A key significance lies in an appropriate and strategic allocation of the funds obtaining from the transaction, for example, towards the satisfaction of historical due liabilities – just as it was in our case. More importantly, according to parties’ assumptions, funds from the transactions were supposed to be distributed in such a way, so that they partly constituted payment of the price for the assets, and were partly forwarded for regulating existing liabilities within the group of companies controlled by the investors participating in the transaction. Of course, all of the cash flows, had to be wisely planned, especially in terms of their legal titles. And so, we preceded to work and prepared a plan to put it all together in a logical whole, using the best instruments that the legislation offers us. This way, we have created a conception of the flows, based on the assignment of receivables, subrogations, transfer of benefits (both the current, and the future ones), and also in-kind contribution as a form of repayment of some liabilities. Just when everything seemed to be going well – a new challenge appeared.


What we need to highlight, is that the mentioned operations connected to cash flow took place with a participation of multiple parties, each of which had their own lawyers. Additionally, TFI, managing the investment fund, also participated in the process, which meant overcoming regulatory constraints. In this group, we had started the next step, which consisted of hours of: negotiations, talks, teleconferences, and attempts to work out a common position that would reconcile the expectations of each of the process’ participants. It may seem easy – there will be a fund flow so all the parties that were supposed to receive it, should do everything to make it happen as fast and as easily, as possible. In practice however, combining all of the transaction’s parties was a surprisingly big challenge.

One of the hardest elements of the transaction, turned out to be leading to a situation in which each of the interested parties achieved a satisfactory legal solutions. Some offers that occurred  during the negotiations, that may have appeared attractive, turned out, after a deeper analysis, to be unfavorable for certain participants, as they would have led to, for example, maintaining an unnecessary investment structure, generating significant costs for one or multiple investors.


Obviously, every transaction carries business, law, and tax risks. This is why, choosing a professional counselor, who is able to both: minimalize mentioned risks, and protect the client as well as possible, is so crucial. Rarely does it happen, that an M&A process is limited to preparing  the asset sale contracts, based on all of parties’ agreements. It is usually accompanied by complex billing processes, which must be properly arranged, in order to achieve the result intended by the Client, and at the same time obtain the approval of other participants. To successfully close the deal, the interested parties must be willing to compromise.

In the end, after more or less three weeks, by using flexibility, firmness, and experience, the project had been successfully finalized! Conclusion? Though it is obvious, it will not hurt to repeat, that anticipation, vigilance, thoughtful strategy and knowledge of the process, and flexibility, are the pillars of transaction’s success.