M&A Practice Update: Lessons from the Eurozone Crisis
March 26, 2012
BY GARRETT HAYES & ROSS MCNAUGHTON
Greeces recent second bailout of €130bn and related debt cut has successfully resulted in the country averting a disorderly default and exit from the eurozone, for now at least. It has also provided an element of stability to the uncertainty that had previously plagued the future of the euro and its members generally, though underlying doubts remain over the health of several of the economically weaker eurozone nations.
The uncertainty and speculation that the problems faced by certain of the weaker eurozone countries might lead to a breakup of the eurozone in some form or another, has undoubtedly had somewhat of a suppressant effect on the European M&A market in recent months. However, the practical experience, legal analysis and market commentary regarding the issues over the past several months as the crisis has unfolded have given rise to some key practice points for cross-border European M&A deals and for buyers assessments of eurozone risks.
As the eurozone crisis continues to play out, there are certain key steps and approaches that M&A market participants can and should take to seek to quantify and assess deal risks going forward. This Stay Current identifies and discusses certain key practice points and will be of interest to those looking to acquire businesses or assets with significant European exposure. It will also be of use to multinationals who already have European operations and who are looking internally to analyse and assess their current risk.