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ARTICLE · 29 JUNE 2026

When A Term Sheet Becomes Binding: What Can We Learn From Hoffman v Finalto?

Lewis Silkin
Lewis Silkin
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Lewis Silkin

Lewis Silkin

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A recent Commercial Court decision is a stark reminder that a "term sheet" can and often will be binding. In Hoffman & Anor v Finalto Group Ltd & Anor [2026] EWHC 921 (Comm), the court found that a preliminary equity...

United KingdomCorporate/Commercial Law
Eleanor Kelly
Eleanor Kelly
Sophie Massing
Sophie Massing
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A recent Commercial Court decision is a stark reminder that a "term sheet" can and often will be binding. In Hoffman & Anor v Finalto Group Ltd & Anor [2026] EWHC 921 (Comm), the court found that a preliminary equity term sheet entered into in connection with an M&A transaction created legally binding obligations even though the intended long-form documentation to formalise the equity arrangements never followed. In addition, the court determined that walking away from the follow-on documents could amount to repudiatory breach.

The takeaway message is simple: draft your preliminary transaction documents with precision.

The deal in plain English

The dispute arose from Gopher Investments' acquisition of Finalto, a financial services technology business. Before the acquisition, Mr Hoffman was Finalto's CEO and Mr Greenbaum was its COO.

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