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Bloomberg Law published an article, “Three Things to Watch Out for When Deal Making in 2021,” authored by Balch & Bingham’s Philip Dunlap, partner and David Bowsher, partner. The article, published on Jan. 20, 2021, highlights three areas for M&A attorneys to focus on as they close deals this year.
Due diligence, Philip and David note, has never been more important nor so difficult. Typically, a buyer would make numerous trips to meet with a seller and would, over the course of those trips, spend more than a week with the seller. They would learn the nuts and bolts of the seller’s business. But in the middle of pandemic, that isn’t so easy. Philip and David urge buyers and sellers to find new ways to connect on a personal level during their diligence process, even in our current Covid-19 filled world.
In addition to this, Philip and David state that workforce issues and problems relating to PPP loan documents are also areas that M&A attorneys need to heed. Not all businesses have successfully managed their workforces through the pandemic, and potential buyers need to be aware of problems in this area. And while the Paycheck Protection Program offered a lifeline to businesses that have been hit hard by the economic slowdown, they also created issues for borrowers who are acquisition targets. Potential buyers need to be very careful that their targets have “dotted their i’s and crossed their t’s” on all aspects of PPP loans.