Advising on M&A transactions

Selling or buying a business (M&A) is a complex process that can fundamentally affect the future of your company. Professional advice on M&A transactions will help you optimize the terms of the sale and minimize the legal and financial risks associated with the sale. From the legal and financial due diligence of the target company to the preparation and negotiation of the sale agreements, our experts will ensure that every phase runs smoothly. Rely on experienced partners to guide you through the entire process.

Why is sales and merger advice important?

Transactions related to the purchase or sale of companies represent a commitment by the entrepreneur that has a significant impact on his or her future business. In commercial transactions, it is a complex process consisting of several stages and negotiations, which can defeat the intended purpose through improper approach or inexperience.

Each transaction is unique in its specifics and therefore it is not possible to universally replicate the M&A process for every purchase or sale. The choice of advisor is as important as the choice of buyer, as the advisor’s role is to identify and analyze the risks of the transaction, address those risks to the counterparty, and negotiate for the client the terms under which the client’s economic and strategic objectives will be met. In the transactional world, there are market standards and unwritten rules that can make the entire process both time and financially efficient for all parties. Therefore, if a seller or buyer wants to minimize the risk of making the wrong investment, it is strongly recommended to reach out to an advisor, even in the initial stages of negotiations.

What M&A transaction services entail

At each stage of the transaction process, the role of the adviser varies, but generally the further the parties are in the negotiations, the more important the adviser’s role becomes and the more the seller or buyer relies on the adviser. In our experience, this is mainly due to the fact that towards the end of the transaction, negotiations are at their most intense and require hours of communication with each other in agreeing terms that require an efficient, market-standard approach and experience. At Highgate , we know that legal counsel is not only the expert, but is also the moral support for the party they represent to offer an impartial perspective and maintain a level of professionalism during emotional and uncomfortable discussions.

Our M&A transaction services consist of a comprehensive package of legal and tax services under one roof. We prepare the company for its sale, provide broad advice on the correct tax setup of the transaction, a team of experts in our office will ensure the entire due diligence process and guide the client through the negotiations and preparation of transaction documentation to a successful final.

Preparing the company for sale and purchase of the business

The seller is in the position of a party who wants to make the sale on the best possible terms and at the best possible valuation. Our role as a legal advisor is to ensure that the seller sets up the appropriate structure in the company, arranges the relationships, or unifies the processes in the early stages of the transaction process, possibly even before the transaction itself, so that the company is ready for the buyer’s entry. Such an internal arrangement will make the company more attractive to a prospective buyer and set reasonable expectations for the selling owners in the sale. A properly chosen sales plan or even negotiation strategy helps the seller to strengthen its position in the market and to select suitable buyers.

Mergers and Acquisitions (M&A) Advisory

On the other hand, the buyer’s legal counsel has an essential role in identifying the risks that may be associated with entering into a company or working with a seller. He or she will create a picture of the company’s functioning for the buyer based on the legal due diligence performed and, depending on the results of the due diligence, will verify the potential impacts on the reduction of the purchase price, as well as ensure the protection of the client’s interests in the transaction documentation. Setting up the regime for the buyer’s entry into the company in terms of an effective legal and tax regime is of crucial importance.

Due diligence – financial review of the company

Financial due diligence provides the buyer with an overview of the financial health of the company it intends to acquire and reveals to the buyer potential financial and economic risks that will give the buyer a more realistic picture of the company. Financial due diligence is useful for the buyer in terms of the reasonableness of the purchase price and the operation of the company, as well as for the seller in identifying areas that the owner should improve before the transaction takes place; from the investor’s perspective, financial due diligence is an integral part of due diligence to enable the investor to assess the return on its investment and the stability of the company in which it is making a contribution.

Advice on finding a buyer or investor

Transaction advisory also includes professional assistance at the time when the owner is interested or considering selling the company, but does not have any offer or interested party on the table yet. In such a case, the advice consists of approaching and evaluating suitable candidates for the purchase of the company who are active in the relevant local or international market. Experienced advisors also build up their own databases of contacts over the years whereby they can discreetly connect sellers with interested parties and assist in further negotiations.

Accounting for the sale and purchase of a company

Accounting control and the way it is kept is closely linked to financial and tax due diligence, as the correct accounting of a company’s individual assets and liabilities is essential for further calculations and risk assessment. For more complex structures that require accounting consolidation, compliance with accounting standards and legal requirements must be examined.

Tax optimisation in the sale and purchase of a company

Tax optimisation consists of strategic planning and set-up of a transaction in order to minimize the tax burden that should arise in connection with the transaction. This process is an integral part of the successful execution of a transaction, as the precise adjustment of the tax structure can materially affect the net financial return to the seller or optimize the overall cost burden to the buyer.

Our experience in sales and purchases of companies for clients

At Highgate, we provide one-stop legal, tax and accounting advice, ensuring our expertise covers all key aspects of the transaction. We represent both local and international clients on both the sellers’ and buyers’ side. We differentiate ourselves mainly in our precision and communication with our clients. We are able to prioritize the client’s interests and thus individualize

What is a legal audit?

A legal audit, also known as due diligence or legal due diligence, is a comprehensive review and analysis of a company’s legal status to identify legal risks. Its main purpose is to protect the interests of the company or a potential buyer or investor by providing an overview of the company’s legal status, its compliance with the law and its adherence to contractual obligations and commitments.

For this reason, it is important that the legal audit is carried out by an experienced team of legal advisors. They will ensure the process runs smoothly, professionally assess the findings, evaluate their seriousness and provide the necessary responses. The output of a legal audit is a detailed report that includes the identified risks along with suggestions for addressing or mitigating their impact. This document serves as an important tool for informed decision-making and next steps in the process.

If you are interested in this topic, please do not hesitate to contact us:

• Tomas Demo, e-mail: tomas.demo@highgate.sk

For more on M&A and private equity, please visit this section of our website: venture capital and M&A

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Alternatively, you can address your specific questions in a consultation with our partner Tomáš Dem, who also specialises in this area. You can book a consultation here: