Marriage & Acrimony: Recent Trends in M&A Disputes

November 10, 2023
Global M&A activity has slowed significantly – the total value of M&A fell to US$732.82 billion in the second quarter of 2023, from $1.14 trillion in the second quarter of 2022 according to Dealogic data as of June 29 20231. While there have been fewer ‘marriages’ in the past year, we are seeing an uptick in acrimony and ‘divorces’. By that, we mean M&A related disputes in the context of both ongoing M&A activity and deals that have been completed in recent years. This growth appears to have been prompted by the economic headwinds that have seen all businesses suffer. These include record levels of inflation and high interest rates, coupled with a slower than expected economic recovery by the second largest economy in the world, China, and the continuing conflict in Ukraine. Therefore, obtaining maximum value from M&A ongoing and past activity has never been more important. This article explores three scenarios in M&A disputes that have come to the fore in recent times, highlighting their implications and possible mitigating measures for businesses and their inhouse lawyers. Material Adverse Change (mac) And Conditionality Related Disputes MAC clauses provide a contractual mechanism that may allow the buyer to terminate the acquisition agreement and withdraw from the transaction if, before completion, certain events occur which negatively impact the target company’s value or operations. MAC clauses provide a means for allocating risk between the parties before completion – essentially providing an exit route for buyers in certain, limited, circumstances. Other conditions precedent for the completion of a transaction are also often necessary for regulatory or commercial reasons. The present global environment...

SCIA Promotes Highquality Development of GBA With Professional Arbitration Service

November 10, 2023
Located on the landmark skyscraper in Qianhai, the SCIA Tower, the new headquarters of the Shenzhen Court of International Arbitration (SCIA) provides an impressive sea view, overlooking the 5.5-kilometer-long highway bridge linking the booming city in South China with Hong Kong. As China’s first arbitration institution established in South China, including Hong Kong and Macao, in 1983, the SCIA now possesses influence that extends far beyond the region. According to the SCIA, the total amount in dispute of arbitration cases it accepted in 2022 hit RMB 127.2 billion ($17.47 billion)— compared with RMB 16.5 billion in 2017 and RMB 3.9 billion in 2012 — the highest in Asia and top three in the world among its peers. Roughly one-third of the total amount, or RMB 42 billion, belonged to international arbitration cases. So far, the arbitration and mediation services of SCIA have been extended to 140 countries and regions. Describing it as a “pleasantly surprising ‘report card’”, An Xin, vice president of SCIA, told reporters in Shenzhen recently that the SCIA is gaining more trust from the market as an increasing number of Chinese and foreign companies have chosen the SCIA for arbitration over the years, and amounts involved were markedly augmented as well. In one of the cases several years ago, an investment dispute arose between Chinese and US companies, involving an amount of over RMB 13 billion, An recalled. The case, which was later famed for being the largest dispute amount in the history of Chinese arbitration, impressed the vice president a great deal. Due to the absence of an arbitration clause in the initial contract, the...

Getting To Know…Paul Haswell

July 12, 2023
A lover of all things tech, Paul Haswell is a highly-regarded TMT focused lawyer, most recently as a Partner with Seyfarth Shaw in Hong Kong. He is also a ‘tech and law’ podcaster, but residents of the city are as likely (or perhaps more so) to know him for his other main passion, music. Haswell has a long running stint spinning the discs on RTHK’s ‘Sunday Escape’ radio programme, and as a club and podcast DJ with Clockenflap, both of which he fulfils with his ‘Crimes Against Pop’ partner, Carolyn Wright. Tim Gilkison recently spoke to Haswell about his journey in law, the importance of mentorship, AI, new music…oh, and time travel! K&L Gates Welcomes Hong Kong Technology Partner Which came first, your love of technology or an interest in the law? Technology, by quite a long way. When I was very young I had three main interests: computers, science fiction, and music. Bear in mind that this was during the very early 1980s, so my interest was being stoked by Star Wars, Star Trek and Doctor Who, the Atari 2600 and then Commodore 64, and whatever I could hear on the radio at the time or find to play on my rather battered hand-me-down record player. I got my first computer (the aforementioned Commodore 64) in about 1984 and spent most of my childhood using it for rudimentary programming, games, and for some reason I even thought that doing my homework using it was exciting. That began my love of computers and technology in general, and ever since then I have been obsessed with new gadgets, the use...

Charles Russell Speechlys Opens Singapore Office

July 4, 2023
  Charles Russell Speechlys further expands into Southeast Asia by opening an office in Singapore today. International partner Jeffrey Lee in the Firm’s Hong Kong office will lead the Singapore office. Hailing from Singapore, Jeff moved to Hong Kong in March 2019 after spending several years practising in London. He advises on complex international structuring for international clients, including their establishment for estate and succession planning, asset protection and personal tax mitigation.  Jeff also specialises in tax planning, advising non-UK domiciled persons moving to the UK. Simon Green, the Firm’s Head of Asia, will be supporting Jeff. Simon’s main areas of expertise are large-scale mixed-use development and redevelopment projects, commercial and residential property investment, real estate management, as well as real estate finance (both Islamic and conventional). Simon also has a significant hotel and hospitality practice. Together, they will continue to grow their respective teams, the majority of whom are based in Hong Kong.  As the Firm establishes its presence in the Singaporean market, it will add further fee earners and service lines to the offering.  The Firm’s Singapore office is located at Charles Russell Speechlys LLP, Suite 8, Marina Bay Financial Centre Tower 2, 10 Marine Boulevard, Singapore 018983. “Internationally, Singapore continues to rapidly climb the rankings as a hub for global business, and there is so much going on in the country for businesses across all sectors,” Lee said. “We have a number of long-standing friends and contacts in the region; indeed, many of our existing clients have had a presence in Singapore for years, so it is tremendously exciting to now be establishing a physical presence there,...

Harneys’ Appoints Its New Hong Kong Managing Partner

May 9, 2023
Harneys global Banking & Finance and Corporate groups head Partner Paul Sephton has been appointed managing partner of the firm’s Hong Kong office. He succeeds Ian Mann, who is stepping down after five years as Asia Managing Partner, and will continue to focus on his practice as a partner in the firm’s Litigation, Insolvency & Restructuring team in Hong Kong. Having joined Harneys in 2016, Paul is highly regarding in his field, and receives consistent recognition by major directories. He advises leading onshore law firms, major international financial institutions and listed and private companies. Paul specialises in debt finance, advising on a range of financial products, including leveraged finance, margin lending, acquisition finance, pre-IPO finance, take-private transactions, bond issuances, convertible instruments, derivative transactions, property finance, and syndicated lending. “Paul has contributed greatly to our success within the Hong Kong market and is well positioned to continue to deliver our Hong Kong strategy. We are delighted he is taking on this role and wish him all the best”, said Global Managing Partner William Peake. William also commended Ian for demonstrating great leadership and dedication during his tenure as Asia Managing Partner, pointing out that Ian’s commitment to excellence has helped elevate the firm’s reputation in the...