M&A: Shareholders’ Rights
Preparing a shareholders’ agreement for an M&A transaction requires an in-depth understanding of shareholders’ rights and powers under the laws and the relationship between the shareholders. The table below sets out some of the rights and powers in respect of different levels of shareholding in a private company* limited by …
M&A transactions and practical empathy
I was reminded of what Seth Godin said about practical empathy in a podcast while I was in a meeting that went on for hours to discuss an M&A transaction. It may not be verbatim. It went along the lines of “𝘱𝘦𝘰𝘱𝘭𝘦 𝘥𝘰𝘯’𝘵 𝘬𝘯𝘰𝘸 𝘸𝘩𝘢𝘵 𝘺𝘰𝘶 𝘬𝘯𝘰𝘸, 𝘥𝘰𝘯’𝘵 𝘸𝘢𝘯𝘵 𝘸𝘩𝘢𝘵 …
How long does it take to complete M&A transactions?
Clients always ask how long it would take to conduct legal due diligence, draft transaction agreements and complete the proposed acquisitions. The answer is “it depends”. The timeline depends on: – clients to provide the commercial terms they want and their comments to draft agreements; – target companies to provide …
What agreements are required for investment into a company?
When determining what agreements are required for investment into a company, consider the following: 1. What is the mode of investment? For example, is the investment by way of acquisition or subscription of shares of the company? 2. What is the subject matter and purpose of the agreement? 3. Who …
Lawyering: Being technically good is just the first step
Being good in the technical aspect of law is just the first step in practising law. There is so much more that goes into practising law in the private practice. Consider the following: 1. Having a template or precedent (even a good one) would not help much if you do …
Subscribing or acquiring shares: check the pre-emptive rights first
An investor who wants to subscribe to shares or acquire shares in a private company should first consider whether there are any restrictions to do so in the following documents: 1. Constitution of the company (if the company has adopted a constitution); and 2. Shareholders agreement (if the current shareholders …
Dividend of a Malaysian company: What directors and shareholders should know
1. It is permissible to use preference shares as an instrument to give investors (i.e. preference shareholders) priority to receive payment of dividend over ordinary shareholders. This preferential right must be stated in the constitution of the company. 2. A company may only distribute dividend to the shareholders out of …
What I do as a corporate lawyer
Part of my job as a corporate lawyer is to listen when clients explain the commercial terms that they want to include in agreements. The next stage involves asking detailed questions to clarify how the commercial terms should work in the actual world (and not just in theory). Sometimes the …
How I delegate effectively
One of the challenges that I face as I progress through my career is how to delegate effectively. Sometimes, it is easier to draft than to review others’ drafts. Putting my own thoughts into words may be easier than reviewing others’ work and trying to understand their flow of thoughts. …
IPO is like an open book exam
Me: “IPO is like an open book exam. You can see from the prospectuses the kind of issues typically encountered by companies going for listing.” My learned friend: “Yeah, but it is a 300 to 400+ pages of open book exam.” While not every IPO is the same, the following …