As the COVID-19 virus continues to wreak havoc around the world,
most countries have imposed restrictions of some kind on their
residents and businesses, in some cases, imposing lockdowns that
have brought much economic activity to a standstill. Against
this backdrop, sellers and buyers engaging in corporate
acquisitions and disposals are faced with increasing uncertainty.
While transactions are still being closed, it is of paramount
importance to build in deal protection mechanisms in sale and
purchase agreements ("SPAs") to deal
with and ensure maximum protection for parties.
In this article, we will discuss the considerations that should
be borne in mind when negotiating SPAs in light of the COVID-19
situation, as well as ways to mitigate risks in merger and
acquisition ("M&A")
transactions.
