GAPVC helps companies in business development, M&A and subsidiary setup by making private equity investment and providing advisory services:
This step is about analysis of industry-specific information. GAPVC works with the client to review its objective of acquisition in the context of its strengths and weaknesses and corporate goals. GAPVC does a detailed analytics around industry data on market growth, nature of competition, ease of entry, capital and labour intensity, degree of regulation, etc. This creates a targeted strategy around potential candidates and possibility of success for each.
- Funnel creation:-
This step is around identifying potential candidates as partners based on criteria defined in Planning stage. Screening process short-lists a few candidates from many available and obtains detailed information about each of them.
- Financial Evaluation:-
of a merger is needed to determine the earnings and cash flows, areas of risk, the maximum price payable to the target company and the best way to finance the merger. In a competitive market situation, the current market value is the correct and fair value of the share of the target firm. The target firm will not accept any offer below the current market value of its share. The target firm may, in fact, expect the offer price to be more than the current market value of its share since it may expect that merger benefits will accrue to the acquiring firm.
||Steps needed for Merger / Acquisition
- Permission for merger:-
Two or more companies can amalgamate only when the amalgamation is permitted under their memorandum of association. Also, the acquiring company should have the permission in its object clause to carry on the business of the acquired company. In the absence of these provisions in the memorandum of association, it is necessary to seek the permission of the shareholders, board of directors and the Company Law Board before affecting the merger.
- Information to the stock exchange:-
The acquiring and the acquired companies should inform the stock exchanges (where they are listed) about the merger.
- Approval of board of directors:-
The board of directors of the individual companies should approve the draft proposal for amalgamation and authorise the managements of the companies to further pursue the proposal.
- Application in the High Court:-
An application for approving the draft amalgamation proposal duly approved by the board of directors of the individual companies should be made to the High Court.
- Shareholders' and creators' meetings:-
The individual companies should hold separate meetings of their shareholders and creditors for approving the amalgamation scheme. At least, 75 percent of shareholders and creditors in separate meeting, voting in person or by proxy, must accord their approval to the scheme.
- Sanction by the High Court:-
After the approval of the shareholders and creditors, on the petitions of the companies, the High Court will pass an order, sanctioning the amalgamation scheme after it is satisfied that the scheme is fair and reasonable.
||Letter of Intent
Both, buyer and seller take the letter of intent to their respective attorneys to find out whether there is any scope of further negotiation left or not. Issues like price and terms, deciding on due diligence period, deal structure, purchase price adjustments, earn out provisions liability obligations, ISRA and ERISA issues, Non-solicitation agreement, Breakup fees and no shop provisions, pre closing tax liabilities, product liability issues, post closing insurance policies, representations and warranties, and indemnification issues etc. are negotiated in the Letter of Intent. After reviewing, a Definitive Purchase Agreement is prepared.
||Buyer Due Diligence
This is the phase in the merger and acquisition process where seller makes its business process open for the buyer, so that it can make an in-depth investigation on the business as well as its attorneys, bankers, accountants, tad advisors etc.
||Definitive Purchase Agreement
Finally Definitive Purchase Agreement are made, which states the transaction details including regulatory approvals, financing sources and other conditions of sale.
||Services Offered by GAPVC
We provide JV consultancy including the following:
- Match Making
- Joint Venture Options & Planning
- Drafting Joint Venture
- Contracts & Agreements
- Incorporating company, subsidiary, or joint venture
- Corporate Structuring & Tax planning
- Cultural Training
- Employee Agreements & Policies
- All other requirements in Outsourcing.
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