Mergers & Acquisitions Comparative Guide –

1 Deal structure

1.1 How are private and public M&A transactions typically
structured in your jurisdiction?

Private M&A transactions are generally structured in Jersey
by way of a private agreement, which involves the sale of a company
or business where the seller and buyer agree the terms of sale
between themselves. The terms of sale will be recorded in a private
contract. The sale may be structured either:

• by way of a share sale (which involves the transfer of
  ownership of the target); or




• by way of a business transfer (which involves the transfer of
  specific target business and assets of the seller).

Public M&A transactions are generally structured in Jersey
by way of one of the following methods.

Takeover offer: This is a statutory process
that involves the bidder making an offer to the target’s
shareholders to acquire their shares in the target. After the
takeover is complete, the bidder and the target remain separate
companies and the target becomes a subsidiary of the bidder. The
bidder may compulsorily acquire the remaining shares if it acquires
at least 90% of the shares to which the offer relates.

Scheme of arrangement: This is a statutory
court process, involving a compromise or arrangement between a
company and its members. It results in the bidder holding all of
the target’s shares.

Statutory merger: Jersey has a merger regime,
which can potentially be used in the context of both public and
private M&A, whether for cash or equity (and including
cross-border mergers, if the other relevant jurisdictions permit
this). In addition to board approvals, it requires shareholders to
approve the transaction by way of special resolution (ie, a
two-thirds majority or such higher threshold as the company’s
constitutional documents require).

1.2 What are the key differences and potential advantages and
disadvantages of the various structures?

The key differences and potential advantages and disadvantages
in the context of private M&A structures may be summarised as
follows:

• Share sale:




• • The transaction structure is often simpler than an asset
    purchase, as the buyer is acquiring a single asset (ie, the target
    shares).

  
  

  • The seller makes a clean break from the target business, as the
    buyer takes the target subject to all its historic and current
    liabilities.

  
  

  • The transaction may be frustrated if not all sellers are
    prepared to sell their shares to the buyer on the terms proposed
    (unless there is some means of forcing a sale, such as a drag-along
    right).




• Business transfer:




• • The buyer can choose which assets and liabilities (if any) it
    acquires.

  
  

  • The seller may be left with problem assets or liabilities that
    the buyer is not prepared to take on.

  
  

  • The transaction process and documentation are more
    complex.

The key differences and potential advantages and disadvantages
in the context of public M&A structures may be summarised as
follows:

• Takeover offer:




• • This requires 90% acceptances by reference to the nominal value
    (par value companies) or the number of shares (no par value
    companies) to which the offer relates, on a share class basis, in
    order to undertake a statutory squeeze-out to achieve 100%
    ownership.

  
  

  • The process itself requires no third-party approvals.

  
  

  • The structure can be used in a hostile situation.




• Scheme of arrangement:




• • This requires the approval of 75% of the voting rights and a
    majority in number of the target shareholders voting on the scheme
    that are present and voting at a court-convened meeting.

  
  

  • Where more than one scheme class of shareholder is involved,
    each class must consent (note, a scheme class is not necessarily
    the same as a share class) on the above basis.

  
  

  • The structure is subject to sanction by the Jersey court.

  
  

  • The structure is ‘all or nothing’ – that is,
    either the scheme is approved or it fails.

  
  

  • The structure is very difficult to use in a hostile
    situation.




• Statutory merger:




• • This requires a special resolution of the target on a share
    class basis to approve the merger agreement; the approval threshold
    may be as low as a two-thirds majority.

  
  

  • Target shareholders that do not accept may apply to the Jersey
    court to object on an unfair prejudice basis within 21 days of
    shareholder approval and creditors also have a right to
    object.

  
  

  • The structure is ‘all or nothing’ – that is,
    either the merger is approved or it fails.

  
  

  • Jersey Financial Services Commission approval may be required
    where the transaction is structured as a cross-border merger (ie,
    not a merger of two Jersey companies).

  
  

  • The structure is very difficult to use in a hostile
    situation.

Jersey companies are listed on various global markets,
including:

• the main board of the London Stock Exchange;




• the Alternative Investment Market of the London Stock
  Exchange;




• the New York Stock Exchange;




• NASDAQ; and




• the Toronto Stock Exchange.

Market rules or codes may therefore also apply in the context of
public M&A transactions. In addition, the UK Takeover Code may
apply to a Jersey public M&A transaction.

1.3 What factors commonly influence the choice of sale
process/transaction structure?

The advantages and disadvantages listed in question 1.2 tend to
be the most influential matters in terms of choice of sale
process/transaction structure.

For public M&A transactions, the level of support and
whether the transaction is recommended or hostile tend to be key
factors in deciding which structure to use.

2 Initial steps

2.1 What documents are typically entered into during the
initial preparatory stage of an M&A transaction?

It is common to see heads of terms and non-binding offer letters
drafted to outline the basic terms of a proposed M&A
transaction. It is also common to see exclusivity and
non-disclosure or similar confidentiality-type agreements prepared
and entered into at the start of an M&A transaction in
Jersey.

2.2 Are break fees permitted in your jurisdiction (by a buyer
and/or the target)? If so, under what conditions will they
generally be payable? What restrictions and other considerations
should be addressed in formulating break fees?

Break fees were traditionally commonplace in larger cross-border
public M&A transactions. However, the general prohibition on
deal protection measures, including inducement fee agreements,
which took effect in the UK Takeover Code in September 2011 apply
to transactions involving Jersey companies, where the code applies
to such transactions.

Otherwise, deal protection measures have not historically
featured as a significant part of local M&A transactions in
Jersey. If the transaction documents are Jersey law governed, any
such measures must comply with local contract law restrictions on
penalty clauses.

2.3 What are the most commonly used methods of financing
transactions in your jurisdiction (debt/equity)?

There are generally no restrictions in respect of the financing
a transaction under Jersey law. A transaction may be financed
entirely by equity or by a mix of debt and equity. Debt tends to
take the form of bank debt or bonds (which may be listed).

2.4 Which advisers and stakeholders should be involved in the
initial preparatory stage of a transaction?

The relevant advisers and stakeholders to be involved in the
initial preparatory stage of a transaction will largely depend on
the nature and structure of the transaction. Generally speaking,
the following persons will be involved.

Private M&A: Legal, financial and tax
advisers should be involved at an early stage of the transaction,
together with any other advisers that are relevant in the context
of the transaction.

Public M&A: Again, legal, financial and tax
advisers should be involved at an early stage of the transaction,
together with any other advisers that are relevant in the context
of the transaction. In addition, depending on the nature of the
transaction, it may be appropriate to involve:

• the directors of the target;




• any substantial shareholders;




• brokers;




• sponsors;




• analysts;




• PR advisers;




• stock exchanges; and




• registrars.

2.5 Can the target in a private M&A transaction pay adviser
costs or is this limited by rules against financial assistance or
similar?

There is no prohibition in respect of financial assistance under
Jersey law. Therefore, in principle, it is possible for the target
in a private M&A transaction to pay adviser costs, provided
that a corporate benefit can be established. However, in practice,
it is usual for parties to bear their own adviser costs.

3 Due diligence

3.1 Are there any jurisdiction-specific points relating to the
following aspects of the target that a buyer should consider when
conducting due diligence on the target? (a) Commercial/corporate,
(b) Financial, (c) Litigation, (d) Tax, (e) Employment, (f)
Intellectual property and IT, (g) Data protection, (h)
Cybersecurity and (i) Real estate.

The level of due diligence to be undertaken in respect of the
abovementioned aspects will largely depend on the underlying
business of the target and the nature of the transaction.

Certain Jersey-specific points to consider when conducting due
diligence on a Jersey target entity include the following:

• whether the target is regulated by the Jersey Financial
  Services Commission to carry out:




• • financial services business pursuant to the Financial Services
    (Jersey) Law 1998;

  
  

  • banking business pursuant to the Banking Business (Jersey) Law
    1991;

  
  

  • insurance business pursuant to the Insurance Business (Jersey)
    Law 1996; or

  
  

  • a similarly regulated business in Jersey;




• whether the target has a place of business in Jersey and has an
  appropriate business licence pursuant to the Control of Housing and
  Work (Jersey) Law 2012; and




• whether the target falls within the scope of the economic
  substance rules pursuant to the Taxation (Companies Economic
  Substance) (Jersey) Law 2019 and, if so, whether it complies with
  those rules.

3.2 What public searches are commonly conducted as part of due
diligence in your jurisdiction?

The following public searches are generally conducted as part of
due diligence in Jersey:

• a search of the public records of the relevant Jersey entity
  (ie, a Jersey target or Jersey subsidiary or Jersey seller)
  maintained by the Registrar of Companies in Jersey;




• an enquiry of the Office of the Viscount in Jersey as to
  whether the property of the relevant Jersey entity has been
  declared to be en désastre;




• an online search of the public records relating to the relevant
  Jersey entity maintained by the Registrar of Companies in Jersey
  under the Security Interests (Jersey) Law 2012 in respect of
  security interests created and assignments of receivables to which
  that law applies;




• an enquiry of the Office of the Judicial Greffe in Jersey as to
  whether, to the best of its knowledge and belief, any relevant
  Jersey entity is involved in any current litigation; and




• an enquiry to the Office of the Judicial Greffe as to whether
  any application has been made to the Royal Court in Jersey by any
  person for an order that a creditors’ winding up must commence
  in respect of any relevant Jersey entity.

3.3 Is pre-sale vendor legal due diligence common in your
jurisdiction? If so, do the relevant forms typically give reliance
and with what liability cap?

Vendor legal due diligence is sometimes carried out in Jersey,
most often for the purposes of a distressed sale or an auction sale
process. However, it is far more common for purchaser-led legal due
diligence to be carried out.

It is possible for providers of vendor due diligence to provide
reports to potential purchasers on a reliance basis (but usually
this is on a non-reliance basis). Where it is given on a reliance
basis, a cap will generally apply.

4 Regulatory framework

4.1 What kinds of (sector-specific and non-sector specific)
regulatory approvals must be obtained before a transaction can
close in your jurisdiction?

The requisite regulatory approvals in respect of any transaction
will largely depend on the nature of the underlying business of the
Jersey target. However, the following regulatory approvals may be
required, depending on the circumstances.

Jersey Financial Services Commission (JFSC):
The JFSC’s prior approval or consent to an acquisition may be
required where the target carries on a regulated activity or is
subject to the supervision of the JFSC or in certain other
circumstances (eg, certain unregulated fund structures).

Jersey Competition Regulatory Authority (JCRA):
If an acquisition of a Jersey entity meets the relevant thresholds
(as established in the Competition (Jersey) Law 2005 and the
Competition (Mergers and Acquisitions) (Jersey) Order 2010), the
acquisition may require the prior approval of the JCRA.

Other potential licence conditions: The
acquirer of a target business operating in Jersey in certain
sectors may require regulatory approval or consent, either under
the statutory regime governing the entity or by virtue of licence
conditions. These sectors include gaming/gambling and
telecommunications.

4.2 Which bodies are responsible for supervising M&A
activity in your jurisdiction? What powers do they have?

See question 4.1.

4.3 What transfer taxes apply and who typically bears
them?

In Jersey, transfer duties are typically not payable in private
and public M&A transactions.

In Jersey, no stamp duty is levied on the issue or transfer of
shares, except that stamp duty is payable on Jersey grants of
probate and letters of administration, which will generally be
required to transfer shares on the death of a holder of such
shares.

Enveloped property tax was introduced by the Taxation (Enveloped
Property Transactions) (Jersey) Law (effective 4 April 2022) and is
payable by the buyer in most transactions involving Jersey freehold
property which is owned by a company and which exceeds a minimum
value threshold.

Jersey does not otherwise levy taxes upon capital, inheritances,
capital gains or gifts; and no estate duties apply. Withholding tax
is not likely to apply to an M&A transaction.

5 Treatment of seller liability

5.1 What are customary representations and warranties? What are
the consequences of breaching them?

Warranties may typically cover:

• the share capital of the target and the group structure;




• the capacity of the seller;




• financial accounts and record;




• changes since the accounting date;




• warranties relating to assets, such as unencumbered title,
  condition and adequacy for the target’s current business;




• IP rights;




• employees;




• pensions;




• material contracts;




• insurance;




• litigation/disputes/investigations;




• environmental and health and safety issues;




• compliance with laws;




• anti-money laundering and anti-bribery compliance;




• insolvency; and




• change of control provisions.

A breach of warranty is a breach of contract, giving the right
of the buyer to claim damages. Remedies for breach of warranty are
generally on the basis of contractual damages but may be given on
an indemnity basis. Recovery on the basis of contractual damages is
limited to the diminution in value of the shares or assets acquired
arising from the breach of warranty. Indemnity basis recovery may
permit a claim which exceeds the diminution in value of the share
or asset agreement.

Warranties can be (but are not usually) given as
representations, so that a breach gives rise to a claim in tort,
giving rise to damages assessed on a tortious basis or,
potentially, rescission.

5.2 Limitations to liabilities under transaction documents
(including for representations, warranties and specific
indemnities) which typically apply to M&A transactions in your
jurisdiction?

Warranties are usually qualified by way of specific matters set
out in the disclosure letter but that will not generally restrict
negotiation of the following limitations on warranties:

• the timeframe within which a claim can be made;




• a cap on liability;




• de minimis levels before claims can be made
  (individual and aggregate);




• provisions relating to how to conduct a dispute that may arise
  relating to a breach of warranty and a third-party claim; and




• a general obligation to mitigate loss suffered.

Other restrictions on warranties would include the seller:

• qualifying certain warranties to the best of its
  knowledge;




• preventing double recovery;




• requiring the buyer to exhaust all rights against insurers and
  other relevant third parties (potentially including
  insurance);




• excluding its liability for contingent claims (until they
  become actual); and




• limiting the buyer’s right to recovery by way of the
  buyer’s knowledge.

Time limits or restrictions for bringing warranty claims are
subject to negotiation between the parties. As a general rule,
non-tax warranties tend to cover one or two accounts/audit periods.
The time limits for tax claims may extend up to six or seven years.
In Jersey, the common law limitation period for breach of contract
is 10 years from the date of breach.

5.3 What are the trends observed in respect of buyers seeking
to obtain warranty and indemnity insurance in your
jurisdiction?

Jersey has generally followed onshore trends in respect of
warranty and indemnity (W&I) insurance and there has been a
steady increase in the uptake of W&I insurance in private
M&A transactions.

W&I insurance may be obtained by either the buyer or the
seller; and a W&I policy will usually cover warranties and
general indemnities provided under the sale agreement.

Under a buyer-side policy, the buyer will generally be insured
for any losses as a result of breach of a warranty included in the
relevant sale agreement. Under a seller-side policy, the seller
will generally be insured for claims by the buyer with respect to
financial loss arising from a breach of warranties given by the
seller in the relevant sale agreement. However, it is more common
to see a buyer-side policy in the context of private M&A.

5.4 What is the usual approach taken in your jurisdiction to
ensure that a seller has sufficient substance to meet any claims by
a buyer?

Various steps may be taken to ensure that a seller has
sufficient substance to meet any claims by a buyer, including:

• reviewing the current financial statements of the seller;




• obtaining a guarantee from the parent entity of the seller to
  guarantee cover of any claims; and




• putting escrow arrangements in place to retain part of the
  purchase price (in the event that any claims should arise).

W&I insurance may also be obtained to cover any claims if
the buyer has concerns in relation to the substance of the seller
to meet claims.

5.5 Do sellers in your jurisdiction often give restrictive
covenants in sale and purchase agreements? What timeframes are
generally thought to be enforceable?

It is very common for restrictive covenants – such as
non-compete and non-solicitation of employees/suppliers/customers
– to be given by the sellers in sale and purchase agreements
in Jersey.

A non-compete convent in a sale and purchase should apply to a
reasonable geographic area for a reasonable time period in order to
be enforceable in Jersey. Generally speaking, a
‘reasonable’ time period is considered to be up to two
years. However, this can be up to three years in exceptional
circumstances.

5.6 Where there is a gap between signing and closing, is it
common to have conditions to closing, such as no material adverse
change (MAC) and bring-down of warranties?

Jersey tends to follow English market practice with regard to
MAC clauses and bring-down of warranties. Therefore, the inclusion
of these matters in sale agreements is not very common in Jersey.
That said, we did notice an increase in buyers wanting to include a
MAC clause in sale agreements during the COVID-19 pandemic –
most likely due to buyers wanting greater flexibility to terminate
a transaction arising from the uncertainty during this period.

6 Deal process in a public M&A transaction

6.1 What is the typical timetable for an offer? What are the
key milestones in this timetable?

There is no standard timetable for an offer from a Jersey legal
perspective – the timetable will be driven by the
circumstances of the relevant transaction.

Key milestones/considerations from a Jersey companies law
perspective in respect of timelines for public M&A transactions
can be summarised as follows:

• Takeover offer: To effect a statutory squeeze-out following an
  offer for shares in a company, the offeror must first give six
  weeks’ notice to any holder of shares which the offeror has not
  acquired or contracted to acquire pursuant to the offer, that it
  desires to acquire those shares.




• Scheme of arrangement: There must be 21 clear days following
  the posting of the scheme circular to members, together with a
  notice of the court meeting and notice of any other shareholder
  meetings needed to approve the scheme and related proposals, before
  the scheme proposals are put to the court meeting.




• Merger: There is a statutory creditor notification period of 21
  days in respect of a merger.

The Takeover Code applies in relation to certain Jersey
companies, pursuant to the Companies (Takeovers and Mergers Panel)
(Jersey) Law 2009 and the Takeover Panel’s rules. In summary, a
Jersey company is subject to the Takeover Code if any of its
securities are listed on a regulated market or multilateral trading
facility in the United Kingdom (including the London Stock Exchange
main marker and the Alternative Investment Market); or any stock
exchange in the Channel Islands or the Isle of Man, for all public
companies and certain private companies if they have or are
considered to have their place of central management and control in
the United Kingdom, the Channel Islands or the Isle of Man.

A Jersey company which has shares listed on other exchanges (eg,
the New York Stock Exchange and NASDAQ) may also be subject to the
Takeover Code if the Takeover Panel considers that the
company’s place of central management and control is in the
United Kingdom, Jersey, Guernsey or the Isle of Man.

Transactions governed by the Takeover Code are overseen by the
UK Takeover Panel. The main functions of the panel are:

• to issue and administer the Takeover Code; and




• to supervise and regulate takeovers and other matters to which
  the Takeover Code applies.

If the Takeover Code applies to the relevant transaction, the
timeline will likely be driven by market rules and the requirements
of the Takeover Code. In addition, other equivalent rules or codes
may apply depending on where a Jersey company is listed.

6.2 Can a buyer build up a stake in the target before and/or
during the transaction process? What disclosure obligations apply
in this regard?

Restrictions: There are no specific
restrictions under Jersey companies law in relation to stake
building. However, there are rules pursuant to insider dealing and
market abuse legislation in Jersey (and elsewhere) which may
prevent further acquisitions of shares where the bidder has inside
information.

In addition, if the Takeover Code (or other equivalent rules or
codes) applies, there may be a number of restrictions in relation
to stake building pursuant to this.

Disclosure obligations: Jersey companies law is
limited in relation to disclosure obligations; although it is
common for the target’s constitutional documents to contain
disclosure requirements, together with penalties for failure to
comply. The penalties include:

• loss of voting rights; and




• loss of rights to dividends.

If the Takeover Code (or other equivalent rules or codes)
applies, the bidder may have certain disclosure obligations
pursuant to this.

6.3 Are there provisions for the squeeze-out of any remaining
minority shareholders (and the ability for minority shareholders to
‘sell out’)? What kind of minority shareholders rights are
typical in your jurisdiction?

In a takeover offer, if the bidder has acquired or contracted to
acquire 90% in nominal value of the shares of a par value company
(or, in the case of a no par value company, 90% of the number of
the shares) to which the offer relates, the bidder can acquire the
remaining 10% by giving notice to the relevant shareholders.

In addition, if a takeover offer relates to all shares in a
company and, at any time before the end of the period within which
the offer can be accepted, acceptances have been received from the
holders of shares amounting to 90% in nominal value of the shares
in the case of a par value company (or, in the case of a no par
value company, 90% of the number of the shares) to which the offer
relates, the holder of any shares to which the offer relates which
has not yet accepted the offer may, by written communication
addressed to the offeror, require the offeror also to acquire its
shares.

6.4 How does a bidder demonstrate that it has committed
financing for the transaction?

There are no specific requirements under Jersey companies law in
relation to the demonstration of financing for a transaction.

However, if the Takeover Code (or other equivalent rules or
codes) applies, the bidder may need to make certain
confirmations/announcements in relation to financing pursuant to
this.

6.5 What threshold/level of acceptances is required to delist a
company?

There is no statutory threshold/level of acceptance in Jersey.
The requisite threshold/level of acceptances to delist a company
will depend on the requirements of the relevant stock exchange.

6.6 Is ‘bumpitrage’ a common feature in public
takeovers in your jurisdiction?

We understand that ‘bumpitrage’ occurs when an activist
investor purchases shares in a company that is subject to a
takeover bid. This can occasionally feature in public takeovers in
Jersey.

6.7 Is there any minimum level of consideration that a buyer
must pay on a takeover bid (eg, by reference to shares acquired in
the market or to a volume-weighted average over a period of
time)?

Under Jersey companies law, if during the period within which a
takeover offer can be accepted the offeror acquires or contracts to
acquire any of the shares to which the offer relates but otherwise
than by virtue of acceptances of the offer, then the offeror will
be treated for the purposes of Jersey companies law as having
acquired or contracted to acquire those shares by virtue of
acceptances of the offer; if:

• the value of that for which they are acquired or contracted to
  be acquired (the ‘acquisition value’) does not at that time
  exceed the value of that which is receivable by an acceptor under
  the terms of the offer; or




• those terms are subsequently revised so that when the revision
  is announced the acquisition value, at the time mentioned in above,
  no longer exceeds the value of that which is receivable by an
  acceptor under those terms.

In any other case, those shares will be treated as excluded from
those to which the offer relates.

If the Takeover Code (or other equivalent rules or codes)
applies, there may also be certain requirements pursuant to this in
relation to the minimum level of consideration.

6.8 In public takeovers, to what extent are bidders permitted
to invoke MAC conditions (whether target or market-related)?

There are no specific restrictions under Jersey companies law in
relation to invoking MAC conditions in connection with a public
takeover.

However, if the Takeover Code (or other equivalent rules or
codes) applies, there may be certain requirements under this in
relation to invoking MAC conditions.

6.9 Are shareholder irrevocable undertakings (to accept the
takeover offer) customary in your jurisdiction?

Yes, it is common in Jersey for shareholder irrevocable
undertakings to accept an offer to be obtained from target
shareholders in order to secure optimal comfort that the offer will
succeed.

7 Hostile bids

7.1 Are hostile bids permitted in your jurisdiction in public
M&A transactions? If so, how are they typically
implemented?

Hostile bids are allowed but are not common. This is probably
because they carry significant additional completion risk and
complexity. For example, less information will be available than on
a recommended bid.

7.2 Must hostile bids be publicised?

Jersey companies law is limited in terms of the publications of
hostile bids.

However, if the Takeover Code (or other equivalent rules or
codes) applies, the bidder may need to disclose its own and any
concert party’s opening positions following the start of an
offer period or an announcement which first identifies the bidder
as the bidder pursuant to this.

7.3 What defences are available to a target board against a
hostile bid?

In practice, a range of defence tactics may be available under
Jersey companies law in the context of a hostile bid.

However, if the Takeover Code (or other equivalent rules or
codes) applies, this may restrict or limit the potential defence of
a target board.

8 Trends and predictions

8.1 How would you describe the current M&A landscape and
prevailing trends in your jurisdiction? What significant deals took
place in the last 12 months?

As Jersey is a sophisticated international financial centre, the
M&A market in Jersey (which includes both international
cross-border and domestic transactions) is exposed to the same
kinds of economic and political factors which affect the level and
type of M&A in larger onshore jurisdictions.

Over the past 12 months, M&A participants have continued to
hold their nerve amid signs of growing economic and political
uncertainty presented by the ongoing Russia/Ukraine conflict and
other global supply chain, financial and political events.

Jersey has seen significant levels of both public and private
M&A activity in recent years. Notable deals include:

• Morningstar’s purchase of the UK and international business
  of wealth management platform provider Paremium Limited for
  £35 million;




• Permira’s acquisition of Mimecast, valued at $5.2 billion,
  effected by way of a Jersey law governed court sanction scheme of
  arrangement;




• Avid Gaming’s C$300 million sale to Entain plc; and




• MKS Instruments’ $4.4 billion acquisition of Atotech
  Limited.

8.2 Are any new developments anticipated in the next 12 months,
including any proposed legislative reforms? In particular, are you
anticipating greater levels of foreign direct investment
scrutiny?

On the basis that the global deal-making environment remains
strong and globalisation continues to be a major driver of M&A,
we would expect that any rise in global M&A activity levels
will result in increased M&A in the Jersey market.

In terms of proposed legislative reform in Jersey, the Limited
Liability Companies (Jersey) Law 2018 came into force on 1
September 2022, with the exception of Article 12 (series of
members, managers, limited liability company (LLC) interests or
assets). This law introduces US-style limited liability companies,
which are aimed principally at US clients; but it may also attract
clients fromg other jurisdictions which are interested in using an
LLC structure.

9 Tips and traps

9.1 What are your top tips for smooth closing of M&A
transactions and what potential sticking points would you
highlight?

The following preparatory actions will help to minimise issues
in any proposed sale transaction:

• Engage reputable valuation experts to conduct a valuation.




• Consider the target market (eg, strategic or financial
  buyers).




• Review the business structure.




• Review the statutory book documentation.




• Review corporate governance processes.




• Complete a thorough vendor due diligence process.




• Have appropriate non-disclosure/confidentiality/exclusivity
  agreements on hand.




• Have a satisfactory form of sale and purchase agreement on
  hand.

Skilful negotiation can make all the difference to any deal:

• The success of a deal can often depend on keen negotiation
  skills.




• Preparation is key: research the asset, structure and value,
  and know your counterparts.




• The price should not be discussed in isolation.




• Multi-issue negotiations can add value to a deal.




• Expert involvement in multi-issue negotiations is vital.




• Always have a best alternative to a negotiated agreement.

The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.