Read all about the long-term business effects of the Covid-19 pandemic on M&A valuations and earn-out mechanisms in an interesting article written by Attorney Moshe Ganot, a partner in our Corporate and M&A practice group.
The article discusses the valuation challenges faced by potential buyers and sellers in M&A transactions during the negotiating phase when the parties discuss the positive and negative effects of the Covid-19 pandemic on the normalized business and financial performance of target companies in certain business sectors (e.g., tech, medical devices, etc.) in an attempt the bridge the “valuation gap”. The article further examines the implementation of earn-out mechanisms in M&A transactions during the Covid-19 era as well as the main implications resulting from the extended length of the customary earn-out period in these transactions.
The article was recently published on the Journal of the Israeli Institute of Certified Public Accountants.
Click here to view the full article (in Hebrew)
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