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Company Law

M&A in Malaysia: What you need to know about private limited company

A private company limited by shares is a common legal entity encountered in M&A transactions, either as a seller, buyer or target. Some of the key requirements governing a private limited company include: 1. The Companies Act 2016 (“CA”) requires a private limited company to have at least one director, …

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Linkedin Post

M&A: Quantitative limitations of liability

In M&A transactions, sellers may try to limit their liabilities by having quantitative limitations in the SPA. Quantitative limitations may take the following forms: 1. “De minimis” limit provides a minimum limit for a claim to be recoverable. The rationale is to exclude small claims where the cost incurred in recovering …

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Company Law

M&A: Dividend of a Malaysian company

When structuring an M&A transaction, declaration and distribution of dividend of the target company after completion may be one of the points that the parties want to include in a shareholders’ agreement. The following are some points to take note for declaration and distribution of dividend of a Malaysian company: …

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Lawyering

A bit of humanity

I saw phone numbers that I did not recognise flashed on my phone screen as I was discussing work with a colleague. I contemplated whether to answer the call. As other introverts may tell you, we generally don’t like calls when we are deeply focused on something. I picked up …

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Linkedin Post

M&A: Three types of material adverse change (MAC) clause

When drafting MAC clause in a sale and purchase agreement, consider which of the following may be more appropriate: 1. Measurable MAC This type of MAC clause provides that MAC is deemed to have happened when measurable financial metrics such as profit, EBITDA or turnover of a target company declines …

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Linkedin Post

M&A: Material adverse change (MAC)

MAC clauses are contractual provisions which allow a buyer to walk away from a deal between signing and completion of the SPA upon the occurrence of material events which adversely affect the target company or business. MAC clauses are intended to provide for unforeseen circumstances which have an adverse effect …

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Due Diligence

Due diligence: Searches in Malaysia

When conducting due diligence, the searches of publicly available information from the relevant government agencies and credit reporting agencies in Malaysia include the following: 1. Companies Commission of Malaysia (CCM) Company search provides corporate information, particulars of directors and shareholders, issued share capital, company charges and summary of financial information. Copies …

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Lawyering

What keeps you going?

An acquaintance asked me, “What makes you so passionate about M&A?” I must have displayed an incredulous look on my face because the person immediately changed the question to something along the line “Okay, maybe not passion but what makes you so interested in M&A that you often write about …

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Due Diligence

M&A: Why should a buyer conduct due diligence?

If you want to acquire a business or a company, should you conduct due diligence on the target? “Buyer beware” or “𝘤𝘢𝘷𝘦𝘢𝘵 𝘦𝘮𝘱𝘵𝘰𝘳” in Latin is a common law principle that a buyer buys at his own risk in the absence of an express warranty in the contract. Due to …

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Linkedin Post

M&A from the purchaser’s perspective: Obligations and liabilities

In an M&A transaction, the purchaser should consider whether any of the following obligations and liabilities are relevant to its acquisition: 1. Where the target has obtained financing facilities which are secured by guarantee provided by the seller in favour of financial institutions, is the purchaser required to step in …

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