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Sale & Purchase Agreement Transcript

Hi, I’m Marc Summers and I’d like to talk to you about Sale & Purchase Agreement negotiation and support. This forms a central element of our approach to assisting our clients, either buying or selling a business, to protect value and reduce uncertainty at a very stressful time.

So, typically, what does advice on draft transaction agreements and related issues include? To ensure that the transaction process runs smoothly, there are lots of ways in which we can do this. For example, it’s important to get clarity in the wording and clauses relating to any financial, accounting and other matters, so by providing input into the drafting stage, we can help you get to where you want to get to.

In order to navigate your way through the process, it’s important to get an understanding of the relevant issues and be able to identify the specific contractual mechanisms involved, thereby mitigating the impact of uncertainty. So what does that really mean? Well KPMG’s innovative approach and thinking enables us to assist  our clients in capturing value, we recently demonstrated this on Ford’s disposal of Jaguar and Land Rover where we applied thought leadership on a complex and innovative deal structure, all supported by robust scenario analysis.

Furthermore, by analysing the issues, we can help highlight positive impacts to enable us to contribute to the drafting of warranties and indemnities and assisting with the consideration of key accounting principles contained in the agreement.

But, what about ensuring you pay or get paid the initial price agreed for the deal? How do we help do that? Basically, by assisting with input into the structure of working capital and price adjustment mechanisms, we can help ensure no unexpected value adjustments get reflected in the cash consideration that is finally paid and providing sound advice on the process for preparing and finalising completion accounts.

This means that our clients are well briefed for their preparation and negotiation in the completion accounts and any resulting price adjustment. This gets value for you. We have proven experience doing this and our cross-disciplinary approach enables us to provide a cohesive team to work with you through the transaction process.

As a central element of what we do, our SPA contract assistance means that we work with our clients throughout the deal process, from initial due diligence to negotiation and agreement of the completion accounts, and, if necessary dispute resolution.

So, now you can understand how KPMG provides advice and support around SPAs, through helping to address value-based due diligence issues in the contract, removing uncertainty and demonstrating how you can derive the most benefit from the deal. In essence, we can set out complex matters in a clear and simple manner, taking the pressure off you!

Our Transaction Services teams lead this activity, with input from a multi disciplinary team including our Forensic specialists thereby commenting on specific aspects of the SPA for example Pensions and Tax and overall we use our extensive experience to protect value for you.

Marc Summers
May 2008

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