Distressed Mergers and Acquisitions

Holland & Knight's Distressed Mergers and Acquisitions Group's mergers and acquisitions, private equity, restructuring, bankruptcy and finance lawyers work together seamlessly to counsel parties in distressed situations.

We advise both sellers and buyers in evaluating, negotiating and consummating transactions involving distressed businesses and their assets. Our experience includes both in- and out-of-court structures. Transactions closed by our group include sales under Section 363 of the U.S. Bankruptcy Code and Chapter 11 plans of reorganization, Article 9 secured party sales, assignments for the benefit of creditors and use of special purpose acquisition companies (SPACs).

On the sell side, our firm has a deep pedigree in assessing the available deal structures to instill market confidence to maximize value. Our attorneys understand the pivot points and the path to closing, from bringing a loan to own strategy to conclusion through a fulcrum security debt for equity exchange, to working from stalking horse asset purchase agreement (APA) and bid procedures through a market-tested asset sale transaction.

Our attorneys also advise both strategic and financial buyers in their acquisition transactions, including evaluating the best strategies to increase the probability of a successful acquisition while augmenting the target's value. Whether leverage-gaining opportunities are limited to understanding the limits of the envelope on stalking horse bid protections, or there exists an opportunity for a loan or acquisition in order to obtain the benefits of plan sponsorship or credit bidding, our group has the experience and market knowledge to navigate the process.

A Contentious and Competitive Process

Multiple bidders, court delays and objections from creditors, credit bidders or other bidders cause uncertainty in distressed asset transactions. Our team's experience in bankruptcy, distressed transactions, finance and M&A enables us to guide our clients efficiently through this complex process. Our lawyers have completed these transactions for companies in every major industry in jurisdictions across the United States, and we know what it takes to get to closing. Our commitment shows, with Bloomberg ranking us among the Top 20 law firms in the U.S. for mid-market transactions in its 2019 Global M&A Mid-Market Legal Advisory Rankings.

Buyers Beware

Buyers of distressed assets must move opportunistically and quickly while minimizing risk. We understand the particular challenges faced in performing due diligence in distressed situations, which are even more critical than in non-distressed transactions, as buyers may have little post-sale recourse against the seller. Timing also can be an issue with court-sanctioned sales being subject to delays that affect the viability of the purchase.

Our attorneys provide a process map for completing purchases and focus on evaluating legal obligations and risks associated with the acquired assets so that buyers can make a realistic assessment of the assets' value. The potential liabilities that can follow distressed assets, such as environmental problems, pension obligations or product liability, should be thoroughly vetted in the due diligence process to mitigate risks.

Increasingly, buyers of distressed assets must protect themselves with representations and warranties insurance. Representations made by sellers in 363 sales may be less robust than in traditional transactions, and we counsel all parties, including both insureds and underwriters, on appropriate due diligence and disclosure.

Local Jurisdiction Experience

While the bankruptcy code is uniform across federal jurisdictions, the bankruptcy courts in each district often vary widely in how they move cases and in setting rules for asset sales. Local rules and protocols often will determine the legal strategy for both sellers and buyers of distressed assets. Attorneys in Holland & Knight's Bankruptcy, Restructuring and Creditors' Rights Group represent clients in every major financial center across the U.S. Our lawyers' experience with judges and familiarity with local rules enable us to move matters as smoothly and efficiently as possible.

Comprehensive Legal Support

Holland & Knight's Distressed Mergers and Acquisitions Group takes a team approach, collaborating with the firm's internal network of attorneys in bankruptcy, Financial Services, Private Equity and other practices that offer legal counsel on transactions and operating issues. We are a complete law firm with 24 U.S. offices serving nearly every industry in middle-market M&A.