Covid-19 now part of the M&A legal process

Author: Jimmie Franklin | Published: 13 May 2020

Covid-19 has become part of the legal M&A process, and is having an impact on due diligence as well as law risks.

Dealmakers are adapting to an entirely new environment, with deals taking longer to complete and in some cases having to be revisited. While M&A has not come to a complete halt, market participants expect that activity will remain down until Q3.

"For those deals which are still progressing, buyers and sellers are now factoring Covid-19 into the legal process as well as the valuation," said Herbert Smith Freehills partner, Gavin Davies. In terms of diligence, there now needs to be a focus on business continuity and the resilience of IT systems, as well as employee measures, data protection compliance, counterparty dependencies and relationships, and any government support that is being accessed by the business. Any change of law risk that the sector may be...