Month: July 2017

Chicago Bridge Reversal Reiterates Need for Consistent Accounting in Working Capital True-Up

The vast majority of private company acquisitions contain some type of purchase price adjustment to account for any changes in certain financial metrics (including working capital) of the target between a specified reference date (or target) and the closing date. For a variety of reasons (including the inability to predict […]

Regulatory Hurdles Facing Mergers With Chinese State-Owned Enterprises

Acquisitions by Chinese state-owned enterprises (SOEs) of companies in the United States (US) and European Union (EU) have grown in recent years. Trade and cross-border investment has increased and Chinese SOEs have extended their reach beyond their domestic market. Those acquisitions, together with joint ventures between Western companies and Chinese […]

Monetizing an Earn-Out – Does That Make It a “Security?”

In life sciences/medical technology transactions, buyers and sellers often use milestone-based and sometimes royalty-based contingent consideration to compensate sellers for assets that are in various stages of development from clinical- to development-stage to product commercialization.[1]  In licensing transactions, there is an established secondary market through which licensors may monetize their […]