This article is written by Soumi Ghose, pursuing a Diploma in M&A, Institutional Finance and Investment Laws (PE and VC transactions) from Lawsikho.com. She is a Legal Counsel in ICON PLC. The views and interpretations expressed in this article are those of the author in her personal capacity, and do not represent any views of ICON PLC or any of its Affiliates.
A sound Merger and Acquisition (“M&A”) lawyer is indispensable for getting tough deals and major transactions like mergers, amalgamation, acquisition, takeover did seamlessly. The council with adequate knowledge, experience to handle pressure always have edge over other counsels.
In the words of Jeffrey Carr, vice president and general counsel of FMC Technologies, a Chicago-based manufacturer of oil and gas exploration equipment – “The best M&A lawyers are tenacious without being overbearing, realistic without being risk-averse. They have to be consummate negotiators to know what their clients want and find consensus without sacrificing the client’s objectives“.
A good M&A lawyer is a specialized lawyer with their inter-personal skills being at par with their professional skills.
Top Skills of an M&A Lawyer
Legal professionals with the following topmost skills, in addition to other skills, needed to support their clients to deal with the complex transactions are treated as good M & A Lawyers:-
- Analysing information;
- Effective communication (both oral and written);
- Power of persuasion
- Effective management of people and collaborative effort;
- Risk-taking abilities;
- Possessing In-depth Business Awareness with a thorough understanding of commercials;
- Good at Time Management;
- Effective multitasking;
- Self-assuredness, and a calm mind;
- Problem-solving skills
These above-mentioned top-skills are briefly discussed in the following sections.
1. Analysing Information
As an M&A lawyer, it is essential to research and process voluminous information in a logical manner, as quickly as feasible, because there is likelihood that this information would have a major impact in the decision making for prospective or on-going transactions. Further, the skill of analysing the information is of immense requirement while conducting “due diligence” of the target company. Moreover, the outcome of these due diligence report is instrumental for making the deal or breaking the deal.
In other words, it is important for an M&A lawyer to evaluate the facts and figures made available to him about the target company, with a logical thought process and appropriate analysis, substantiated with his analytical skills for decision making for or on behalf of his clients. The M & A lawyer through his evaluation can highlight the weaknesses of the target company, which would in turn help for further negotiations. In a nutshell, the analysis by the M & A lawyer helps in preparing legal strategies, which is comprehensive and easy to use like a ready reckoner for the stakeholders. These requirements do instil the qualities of judging the details of the transactions.
2. Effective communication skills (both oral and written)
Excellent communication skills do not only make a good M&A lawyer but also a great negotiator who can thrash out a solution. The best M&A lawyers possessing excellent negotiating skills helping their client and the other organization (target company) to reach an agreement, which gives both the parties a “win-win feeling”. A sound M&A lawyer will be able to negotiate successfully with the other party’s counsel as well as other professionals of their team. The hardest part of the negotiations during an M&A transaction is usually right at the beginning when both the sides are looking to set the terms for the deal and bargaining hard. However, legal professionals are required to bring their negotiating skills to the table until the transaction is successfully closed. Simultaneous to the rounds of discussions and negotiations, the terms and conditions of the agreement to be executed between the parties resonating the deal is needed to be finalised by the lawyers at both the ends. All the negotiated terms and conditions must be duly captured in the agreement and are aligned in a manner which is finally agreed and accepted by the parties.
3. Power of persuasion
Lawyers must be able to hold on to their client’s side of the bargain and protect their interests, and this essentially is done only through sharp negotiation skills. Therefore, sharp and effective negotiation skills are what is required by every M&A lawyer to effectively carry out the goal of deal protection.
4. Effective management of people and collaborative effort
While handling critical transactions as an M&A Lawyer, it becomes immensely important that the individual (i.e M&A lawyer) handle his team of lawyers, working under his instructions, effectively utilising their abilities to the optimum. However, to bring out the best amongst teammates and to channelize them in the most efficient manner, it is important that to communicate effectively with his teammates. Further, the communication is not restricted to the in-house team or colleagues alone, but regularly it is also extended to the numerous professionals with different skill-sets, who are working towards the same goal. The M & A Lawyer must be able to efficiently manage bankers, accountants, brokers, and other professionals to get work done. More often than not, in such transactions, the M&A Lawyer is the main person through which all the information passes. Legal professionals who can identify the best qualities in other team members and optimize their efforts will improve the productivity of any collaborative effort. For any efficient lawyer irrespective of the fact whether he is involved in M & A transactions or not, it is important that they are good listeners. The ability to listen to what the clients’ say, helps to analyse and choose the requisite details needed for respective transactions.
5. Risk-taking abilities
Risk is inherent in any form of business, more particularly, when there is complex business transactions like mergers, acquisition, and business take-over etc. are involved. As a lawyer associated with this kind of transactions, it becomes increasingly important to step in the shoes of the client and to agree for that risk for which being an M & A lawyer, the professional feels that the business has an appetite. Moreover, the M & A lawyer is expected to have the professional knowledge and understanding about the nature and extent of risk involved, in turn, he is expected to guide the clients against all adversities which may result in due to the respective transactions. With the professional guideline from the M&A lawyer, if the client chooses to proceed, then it is important for the lawyer to step into the risk without much worry about the adversities or consequences. Simultaneously, be prepared to handle hold and provide professional guidance to the client, if in case there arises any crisis. In terms of safeguarding the M & A lawyer from any of the adversity which may result to as a consequence of the choices, he affirms for, the professional indemnity and related insurance schemes do prove to defend.
6. Possessing In-depth Business Awareness with thorough understanding of commercials
An M&A lawyer needs to possess high levels of business awareness. They must be aware of the economic conditions of the market, specifically in relation to industry, where the transaction is taking place and they should be in a position to project a complete picture with all the pros and cons influencing the business. They must also have a proper understanding of the industry in which their client’s business is. The M & A lawyer needs to have an analytical mindset regarding the factors that impact the industry. The M & A lawyer should have in his fingertips all those companies, which are in mature stages, in sunrise stage and which ones are going through stabilization, all need to be at his fingertips. This kind of preparation needs for research skills, awareness and foresightedness, in order to be updated. This is necessary to provide proper guidance to a business in negotiating the various stages of the transaction and closing it successfully. It will be sensible if not just M&A attorneys but all corporate lawyers develop a habit of reading business publications. They must also make efforts to know about their client’s business operations, which will help them in assessing the impact of the deal on the enterprise.
7. Good at Time Management
Most of the M&A deals are time-bound, are with a defined timeline for completion. Alignment to defined timeline by the M & A lawyers is not merely an operational requirement but a reflection of their professional attitude. At the very inception of any M & A transaction, the appointed M & A lawyer gives preference to drawing defined timelines for all required activities, in order to streamline all the works necessary for the desired transaction.
8. Effective multitasking
For an M&A transaction, decision-making happenings at different levels. It is essential that the M&A lawyer should have the ability to overcome decision-fatigue, and effectively address issues arising out of sophisticated transactions, as it would touch upon many aspects of the law. An M&A lawyer should have the adequate skill to prioritize the activities as it may not be possible to complete many things at once.
9. Self-assuredness, and a calm mind
It is of great importance that the M&A lawyer has the capacity and capability to face any challenge in the due course of the transaction. It is possible to do so with an organised thought process so that there is no slip out at any step of the transaction.
10. Problem-solving skills
The client looks at an M&A lawyer as the professional to address all the existing as well as a prospective problem related to the transaction. Therefore, it is essential for an M&A lawyer that his approach is to resolve issues amicably, keeping the interest of his client in mind.
Good M&A lawyers are great at managing projects, with a vast understanding of corporate law, and they are able to understand the details as well as the bigger picture regarding the transactions. They indeed exercise great judgment, communicate effectively with the client to ensure everyone is on the same page, and understand the goals of respective clients. They are also keen on learning that as professionals how and to what extent they are responsive and accountable for the desired transactions.
M&A transactions are generally demanding and fast-paced. Ultimately, experiences of an M&A lawyer depends upon various factors like:- the typical staffing on transactions, the complexity of the deals, timing for getting them closed and the clients’ expectations.
When negotiating a transaction, seemingly insurmountable issues inevitably arise — whether legal, business or logistical. M&A lawyers can feel a great sense of accomplishment in resolving these points for their clients and getting the deal done.
M&A lawyers who regularly work on complex transactions that are sometimes understaffed, and subject to aggressive timelines for demanding clients are likely to endure considerable stress. When experienced M&A lawyers can influence these elements, by managing client expectations regarding desired closing dates, or obtaining adequate staffing for a deal on a short timeframe. These experiences M&A lawyers are known for their well-organized channelization of the requisite efforts, to be undertaken by the team of lawyers working together for the materialization of the deal.
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