Mergers and Acquisitions Explained: A Crash Course on M&A
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- Опубликовано: 27 май 2024
- #mergersandacquisitions #corporatelaw #business
Mergers & Acquisitions (commonly referred to as M&A) is often considered a fast-paced, exciting niche of corporate law. And, it is. Brett loves the work he does and his role in M&A deals. So, this video addresses a lot of common questions regarding M&A.
We'll take a look at what M&A is, types of deal structures, the key players, the motivations for performing a merger or acquisition, and what deals looks like at different levels of the market.
Here's a quick rundown in case you want to jump ahead:
0:44 - What is M&A generally
01:04 - Asset Sales, Stock Sales and Mergers
04:28 - Why do Sellers Sell a Business?
05:19 - Why do Buyers Buy a Business?
06:40 - Who's Involved in the M&A Process?
06:42 - Investment Brokers and Investment Bankers
09:23 - Corporate Lawyers
10:47 - Business Appraisers, Accountants & Consultants
So, take a look and let us know what you think!
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Have questions? Book a call, and talk to Brett today:
clarity.fm/brettcenkus
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You can reach Brett through:
clarity.fm/brettcenkus
/ brettcenkus
/ bcenkus
www.cenkuslaw.com
braatenwoods.com
merger-resources.com
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Brett A. Cenkus has 20+ years of experience in business law, finance, and entrepreneurship. Through Cenkus Law, PC, he provides advice and services for mergers & acquisitions (M&A), securities offerings, founders’ agreements, and other general business law issues.
Through Braaten Woods, LLC, Brett helps business owners in the lower middle market ($2MM - $25MM) position themselves for sale, find buyers, negotiate, and close M&A deals.
Brett also maintains merger-resources.com, a site packed with free articles, videos, checklists, deal diagrams, template contracts, and other tools to help pass M&A knowledge to others.
Brett regularly consults with entrepreneurs and invests his own capital as an angel investor.
From 2010-2013, Brett served as Chief Legal Counsel of a publicly-traded international oilfield services company. From 2001 to 2006, he and a partner founded and built Paragon Residential Mortgage. Bridge Investments acquired Paragon in 2006.
Brett holds a Juris Doctorate from Harvard Law School and a Bachelor of Arts degree in Economics from Messiah College in Grantham, Pennsylvania.
Brett lives in Austin with his wife, Cathryn, and two children. He enjoys reading, squash, classic movies, great food and wine, and the New England Patriots. 
Хобби
I love the way you speak about your job and this profession. It seems you take pride in this and are genuinely interested. Yeah this job is tough but I'm glad there are lawyers like you. And thanks for sharing!
Yes! He's so inspiring and enjoyable to watch.
I AGREE!! Love to see more people talk about what they love especially in business
Thank you for such positive feedback!
Knowledge gained from your 13 minutes video > my 3-month M&A internship. Thank you for the quality content!
You're welcome, Seyma!
...how is that possible
hello dear can you help me in finding merged and acquired companies list I am in need of it. Thanks
Where the hell did you work 😂😂
The Krusty Krab@@bishoyhanna3949
Can a person not understand his clarity, and thoroughness. Very great presentation!
Thank you, Alex!
I thought this is on murders and executions.
An understandable mistake!
😂😂
😂
Okay Patrick Bateman
Ahahah
Well done. That was a good solid introduction to what M&A is. Great job.
Thank you so much for the explanation! You're fresh and smart, pleasure to watch!
you're welcome and thank you for the positive feedback!
She want some of them M's 💲💲💲💲💲
I am HOOKED, oh man what a great video series. So happy to find your channel, Brett!
You're welcome, Ross - glad you are enjoying the channel!
Love the way this guy talks
Thank you for the clear explanation. Well, put.
Killed it! I saw the complete video and read all the comments and your detailed response to most of them. I must say it would be a priviledge for your clients and the people who work with you with such a clear guidance. The detailed responses were very informative and worthy. I personally learnt a lot.
Kudos from India!
Thank you, Tushar!
Great video - very well explained! Thanks for posting!
This is amazing! I have always been interested in mergers & acquisitions, basically business law. Great video!
thank you, Daniel! Glad you enjoyed it.
@@BrettCenkus I have a question. If you were getting into M&A today, what are the industries you would recommend. Thanks. Great vid.
You are so clear at the explanation of this topic! Thank you very much for making me understand it!
You're welcome, Arsela!
Solid explanation about Mergers and Acquisitions. I've always been interested in m&a and business law in general. Great video!
thank you, Andre!
You seem so kind and genuine. Also I love how you explain things! Thank you so much for this! I worked in the legal sector for a long time but I am only now thinking about becoming an M&A lawyer! thank you :)
You're welcome!
You're welcome, Larissa!
Excellent presentation
As other people have mentioned, I love the way you talk about your job. Thanks for sharing your knowledge.
thank you, Arnaud
Very helpful/educative information. Thanks for sharing!
you're welcome!
I feel thankful to have found your channel.
thank you, Siddhant!
Very clean speaker. So easy to understand. Great video
Thank you, Gavin!
a great chunk of thanks for sharing and explaining the business matters, highly appreciated
you're welcome!
Great video, Brett!
Perfect video. The best explanation of M&A on the web.
thank you for the feedback!
Just transitioning into a corporate and commercial legal counsel/secretary. I am glad I found this Chanel.
thank you, Rosemond!
Nice to know you and well presentable materials. THANKS!
thank you, Hashem!
Thank you very much, Mr Cenkus. Very informative presentation. I have a question - do investment banks help their clients identify and find potential acquisition targets? I give you an example of what I mean - let's say I have a commercial bank and I want to expand its operations by acquiring other banks. Can I instruct my investment banker to find all the commercial banks which fit the criteria laid out by me (e.g., size of the assets, geographical location, number of branches,etc), then approach their owners and start negotiating the acquisition?
Thank you for the time and effort you put to share this knowledge. Very helpful
you're welcome, Ehab
Impressive. Pretty a rookie on this!
I just didn't know about M&A but your explanation is a mark of a guru.
Well done Sir, that to me is a truly definition of the state of the art!
Looking forward for brighter business days ahead
Thank you, Isaac!
Hey Brett, thanks for such a clear explanation. I learned a lot!!!!
You're welcome, Rashid. Thank you for letting me know the video was helpful to you!
Appreciate your crash course. Loved your simply stated approach.
Thank you!
Finally some sweet M&A content. Big up Brett
thank you!
Thank you so much great video 🙌
Very informative! Thank you
you're welcome
Nice video Brett!
I wish you would start making videos again. These are great.
Thanks for providing overall idea about M&A.
You're welcome, Sathiyan.
Thank you!! It was very helpful
You're welcome
Man! Thank you for this video. So valuable
You're welcome, Carlo!
Pleasure to watch, thank you Sir
Glad you enjoyed it!
Amazing description
This is a great video, I’m trying to get into the focus of M&A. If you have any recommendations please share!
Great video Brett.
I am wrapping up my grad school in Finance and looking to join M&A. These videos are very helpful. Thank you !
you're welcome, Ibrahim. Are you graduating in December? Good luck down the final stretch!
Thank you... enjoyed the great content
you're welcome. Thank you for the feedback.
Corporate paralegal here, thanks for the video! I’ve found: always look for liabilities in restricted stock units to employees or consultants the seller has retained.
Where did you start to get that job?
very helpful video, thanks
You're welcome!
It was a nice outlook about the overall topic..
This is gold. I would have to pay for this in my state over a consultation
thank you!
Awesome video Brett!
Thanks!
Thanks for useful information :) nice video
you're welcome. Glad the info was helpful!
New subscriber here! Love your channel and the insight you give to viewers. I do have a quick question for you regarding your education. I noticed you stated you graduated from Harvard. In your opinion with the exorbitant cost of say a T20 school... Would you take on the debt? or If you can self pay and receive scholarships to a lower ranked state school (ranked 50-75) would you go that route? Thanks for your time!
Thank you - helpful video
Great learning! thanks
My pleasure!
Thanks for sharing!!!
Hello Brett, loved your informative videos. Many thanks for sharing. Greetings from Germany, Soreb PS: Channel subscribed glaldy!
Great video thank you.
Thank you Brett Cenkus, for the magnitude of value you share with us. I have a question, if you could shed some light:
How could a potential buyer incentivize a broker to “recommend” 100% seller finance to the seller?
Thanks in advance.
Considering going back to school for either accounting/finance BA or Law School for Transactions/Real Estate/and Tax Law. I wanted to ask if you have any recommendations for law school, the profession and learning how to prepare these documents or resources to learn this material? Is there any information you can provide with a day in the life as well? Thanks
Quite informative ,thanks Britt
You're welcome, Francis!
Thank you Brett !
You're welcome!
Great content my man!
Appreciate it!
Outstanding! good job
thank you, Richard!
Thank you sir!
Very informative! Thank you for your video. I was asked to be part of a team. I did a little research about the company and it deals with business acquisitions, an area I don't have any knowledge about.
Again thank you for your video, it made me realize this career isn't for me. I admit you know your stuff!
thank you for the feedback. I'm glad the video helped you make a clear decision (even if it means the M&A profession lost you!)
I'm studying BA, not sure what master can get into M&A so here I come to learn what is M&A job duties. This is really helpful and insider knowledge. Thanks, Brett!
you're welcome, Zazie!
Does dividend policy affect M & A.
Thanks for d explanation
@2:38 is interesting.
Wondering why people say consultants charge more for a merger, when it seems we can do it ourselves.
What exactly are they charging so much for?
Hi. Is it normal to ask employees, directors etc. To sign an undertaking whereby they are prohibited from buying buying shares of a listed company for a certain time period until the deal goes public? At what point do I ask for such undertaking? At the due diligence stage or at the initial offer stage?
I watched your video (leaning) towards the 10 steps for the selling company. You mentioned the info might be used by the buyer also.
A private buyer with intent to acquire a five million dollar company, how do the steps differ if at all? I live in the Caribbean region. Most laws here are similar to the US if not more lenient.
How do I begin the process (contact said company) without negative response?
Interesting stuff! Did you start off in business school and then make the switch into law?
Troy, I haven't gone to b-school (although my undergrad work was in Economics, so that's in the ballpark). When I was applying to grad schools in 1995, there was a zero chance any quality business school would take me from Messiah College and with one year of experience in the business world (probably not very likely today either!) So, I went to law school, never really intending to be, or identifying as, a lawyer. I've always loved business. I love finance, strategy, entrepreneurship. I've read tons and tons of books, self-studied, analyzed businesses - those are the sorts of things/topics where I lose track of time easily. Over the years, I've come to enjoy and identify with my lawyer role more, although I still gravitate toward the business side of things -- why deals get done, the financials, the people issues, etc.
I'm wanting to like this twice
Thank you so much Brett! I have an upcoming interview for an internship in Transaction Advisory Services - M&A with one of the BIG 4 this week and I wanted to ask to what extent their work is different from what you do. What advice can you give me for the interview itself regarding more theoretical questions? Thx again!
Philipp, I'm a bit behind circling back to your question and, because of that, I may have missed the opportunity to help you before your internship interview. Still, your question is a good one with broad relevance so I will answer it now anyway. Transaction advisory services at the Big 4 is similar to investment banking. Your job would be primarily a marketing and sales position with a heavy finance component. You would be more heavily involved in preparing a business for sale, marketing it, and negotiating the terms of a deal. You would also often play a key role in shepherding a deal toward closing -- a project management-type role. M&A lawyers get more heavily involved once the deal is struck (often once a letter of intent is signed) and their job is more about documenting and closing the deal than the strategic negotiation and structuring of the deal. It is sometimes different for me given my background on the M&A deal and finance side (non-law) side of thing, although clients don't typically look to their lawyer for guidance on the value of their business. They look to their lawyer for advice about the legal and tax ramifications of structuring an M&A deal one way vs. another (asset sale vs. stock sale vs. merger). That's probably the best way to put it -- transaction advisory services and investment banking is about pricing and marketing M&A deals and M&A law is about documenting and closing the deals. There is overlap, although there is still a distinct diving line somewhere in there.
Wow that was a great answer for me and I didn’t even ask the question
I don't know why, but even at 14 (soon to be 15) I'm interested in mergers, assets and acquisitions. Thanks for the information! : )
You're welcome
Are you still learning about it?
@@glizzforman8094 At 18 yeah probably
Hey! Im just one to ask how can I analyzation of the impact of coronavirus crisis on merger and acquisition?
Great video
thank you, Tim
Thanks for this video.
I would like to ask for your advice.
I got into a difficult situation and have no experience with it.
Topic: What happens to the money of small investors in the event of a SPAC merger failure.
-What is happened if a SPAC Merger fails?
SPAC Company,
THUNDER BRIDGE ACQUISITION II, LTD - announced its intention to merge with INDIE SEMICONDUCTOR last year (2020) to bring it listed on NASDAQ stock exchange in 2021 first quarter.
But an investigation has been launched against the blank check company, saying that "the shareholders have not been properly informed and small investors will have little stake in the formed, new company. After the merger".
> 1.If the merger fails, what happens?
Small investors lose their invested capital either
return to a low share price and "their invested capital get stuck in this SPAC, "blank check company" ?,
I do not understand why an investigation is launced against SPAC with the reason that small private investors can only have wenig stake (prozent) in new company after the Merger because the small investors do not think rhey could more have in it, for them is not point, they are not interesed in how much prozent they can have in a very big company.
The ones who are "big companies" like financial companies, funds want to have more in a SPAC, but not private small investors.
> 2. What should I do in this case if the stock price has already dropped so much that it is lower than the average of my buying price?
Thanks for help, answers,
Very informative video Brett. I was wondering how you conduct due diligence as a mid-level corporate law firm. Do you hire external researchers or task one or two of your contract lawyers to kick the tires? Thanks
Eric, we don't get too heavily involved in due diligence at my firm, mainly because our deals tend to be smaller (than when I worked for a big firm) and budgets are tighter. So, most of the due diligence is done by the company and they reach out to us as-needed (with questions on specific items, review of certain contracts for anti-assignment clauses, etc., but not for a full-on due diligence process). Sometimes we get more involved with sellers by helping them manage and prepare for the due diligence process, including setting up a data room and things like that. With all of this work, we handle it in-house (me or one of the other couple of other lawyers working with me). In big law, we did the work, as well, just more of it (more lawyers, more involvement in the due diligence process).
hello sir.I need mergers and aquisition companies list for my resarch. Where I can find this list?
Hey Brett! Do you also handle the financial due diligence?
is there an effective way to research mergers, as in articles of combination between one company taking over another. So if you think in terms of banking and financing. Banks buying other banks?
Do u provide services in Canada and other parts of world as well ?
Hi Brett! Excellent video. This was very simple and helpful. I have an interest in M&A work. I was in the sports field but I am deciding whether to transition into corporate law or investment banking. Which path will give me more exposure to M&A deals? Any advice would be helpful as I make this transition. Thank you again for the video.
Casey, both paths can give you equal exposure, from a quantity standpoint, to M&A deals, assuming you're able to get into the M&A space in each field. My sense is that investment banking is a tougher path to get down. I think there are fewer investment bankers focusing on M&A than M&A lawyers. I may be wrong about that, although that's my sense based on experience and the limited data I've seen. I know there are more lawyers generally (a lot more lawyers than investment bankers), so the possibility of getting a job in some area of law and then moving into M&A seems like it offers more opportunity to break into M&A than going the IB route. Qualitatively, you'll see the deals from both angles (i.e., you'll get a bit of the other job and what they do), at least as you gain experience and move up the chain. In other words, the top M&A lawyers and top M&A investment bankers see a lot of each other's work. At the junior level, that is less true, because they have less time at the "table" (seeing the negotiations go down). And, even at the senior level, they aren't doing each other's work (naturally). So, the investment bankers will see a lot more of how the deal gets put together, priced, financed, sold and the lawyers will understand the intricacies of the deals are documented on paper. As a law student, I thought investment banking was a much more substantive (sexy) job. Now, I don't think that, although if I had to pick one, I'd say that investment banking gives you a bit more overall exposure to how M&A deals get done because of the focus on structure, price, and financing.
Your channel is Awesome!!!!!
thank you!
Can you talk about what is needed to start an escrow account and submitting the escrow agreement to the bank?
Great Value ! thanks
Thank you, Mathis!
Thank you for this, I’m looking to soak up as much as possible and potentially hiring a coach in that middle market, are there any coaches that you recommend or a course that can help me to be adequate enough to start talks with partners and Investors? TIA!
Hello Brett, I have a Question, if a big company were to try to buy out a small company, without any notice, Would I in M&A, be working with that?
Good stuff
Hi Brett, I am a law school student with my 1st “big law” internship coming this summer. I am interested in transactional/M&A type of practice and wanted to know what I can do to prepare. Any book recommendations or any other tips would be super helpful! Thank you
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Great video. What industries would you recommend someone look into for acquisitions?
do you mean what industries do I think are hot / ripe for picking up companies (good opportunities to be an M&A buyer)?
@@BrettCenkus Yes.
@@BrettCenkus Oh, and thanks for the reply. I am pleasantly surprised. Also, regarding the industries, I am looking at being in this business for the long haul, 15-20 yrs, at least. So, this being a rapidly changing world, this plan factors into the industry I will choose. I was planning to do healthcare, but I am not thrilled with this industry as a long term play for me. Manufacturing seems like viable option. Again, any feedback world be appreciated.
3rd question how to find understandable donations and resources to accept certain treaties being broken and misunderstanding situations due to out numbered and unable to have any way to protect your chosen allies and family lines.
Hey Mr. Cenkus, thanks for the great information. I'm doing creative research for a story that has elements of corporate law involved. I'm looking for accuracy. Specifically, let's say a company is trying to buy out one of its competitors. For instance, a product packaging company wants to buy out another product packaging company. From the legal perspective, what would be the core differences between a product packing company buying out another product packing company as opposed to a department store buying out another department store? Or is it all the same? Besides the obvious difference in the type of business it is.
Nick, 90%+ of an M&A deal is not industry specific (i.e., it doesn't matter what industry the buyer or seller is in). Significant things that can commonly vary by industry are company valuations (e.g., technology companies sell for higher multiples than service companies), deal structures (i.e., certain types of businesses are more commonly transferred by selling the stock/equity of the company vs. its assets vs. through a merger), regulatory considerations (i.e., some industries are more heavily regulated than others, which leads to additional buyer due diligence and more brain damage around transferring licenses), and risk exposure generally (i.e., some industries are more prone to litigation than others, which, as with heavy regulation, generally leads to increased buyer due diligence and the use of risk mitigation tools (e.g., buyer holding back from the purchase price a larger escrow from indemnity claims post-closing).
@@BrettCenkus Thank you for the detailed response. I sincerely appreciate your time.
@@nickcise9049 yw, Nick. Feel free to reach out if you have further questions. Best success with the story!
Thanks, great summary! Have to ask though, why the Elvis mugshot in the background?
That's one of about a dozen celebrity mugshots that were more tightly arranged in a wall collage until about a year ago when one fell down and a couple of others shifted, i.e., the project is falling apart, and I haven't decided to fix it or do something different. Jane Fonda, Kurt Cobain, Al Capone, Jim Morrison, Johnny Cash, and Frank Sinatra are some of the other featured celebs.
learnt all this from louis litt
Great video, how can I contact you? And is a board always required for M&A Deals?
Hi, Frank. You can find contact info for me at cenkuslaw.com. Regarding your question about whether a board is always required for M&A deals, the context (M&A) is not the key consideration. The key issue is the type of entities involved. Almost all corporations have boards of directors and a board of directors will be heavily involved in approving any M&A activity. If a buyer or seller runs their business as an LLC, there is not a board of directors. There is sometimes an equivalent (a board of managers), although not always. So, it depends on whether the buyer and seller are corporations or something else.
Great!
What if you are interested in a local competitors business as a silent investor? Thanks.
You are working with a client as a Chief Technology Officer, and you have produced a graph to help your client understand how each of the investment accounts will behave over time. Write your client a report outlining an investment forecast and recommending in which type of account they should invest.
In your report, to support your claims you should use comparisons of the data and an explanation of the chart trendlines on the next tab. Address whether the client is looking to invest short term (five years or less) or long term (longer than five years).
Which of the chart types on the following Excel page, titled “Chart Types” will be most useful for supporting your recommendations? Why?
can you answer that question please?
Great vid
thank you!
Thank you😄
You're welcome 😊
very good video :D you seem to like the big tech companies :D