Mergers and acquisitions (M&A) activity for assets subject to crisis or financial difficulty (distressed) has been and should continue to be strong in Brazil.This edition of LS Brazil Outlook addresses some legal challenges involved in these transactions. The position of the seller's creditors in an asset M&A under crisis is always a key factor in the success of the transaction, although commonly underestimated. Sandbagging clauses, which are a way of allocating risks between buyer and seller, must be treated carefully to ensure their validity in the event of litigation. M&As involving public counterparties require sensitivity to social, political and regulatory issues. Competitive aspects, of potential market concentration by the buyer, also need to be considered.
On this issue | February 2024
Creditor’s position in the context of debtor’s distressed M&A deals
Distressed M&A transactions entail the concrete risk of interference from seller’s creditors, but creditors’ perspective is seldom addressed. Given the challenges that they may face, creditors should be careful in seeking the appropriate protection...
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Sandbagging clauses in distressed M&A
In a scenario of uncertainty, mergers and acquisitions (M&A) activity in distressed assets stands out in 2024. However, sandbagging clauses in M&A, despite being admitted by Brazilian law, require caution and consideration of good faith, in...
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M&A with public counterparty should be treated as distressed M&A
Mergers and acquisitions involving public entities must be treated as distressed M&A, requiring strategic professional guidance to convince interested parties about the benefits for society.
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Antitrust aspects of M&As involving companies in financial distress
In this article, Marcos Malvar and Marjorie Gressler show the legal strategies and challenges in mergers and acquisitions to ensure stability and comply with Cade regulations.
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