Carve-Out Transactions: Recent Trends, Key Due Diligence Considerations, Structuring the Deal, Risks, Challenges
Course Details
- smart_display Format
On-Demand
- signal_cellular_alt Difficulty Level
Intermediate
- work Practice Area
Commercial Law
- event Date
Wednesday, September 25, 2024
- schedule Time
1:00 p.m. ET./10:00 a.m. PT
- timer Program Length
90 minutes
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This 90-minute webinar is eligible in most states for 1.5 CLE credits.
This CLE webinar will review the key considerations specific to carve-out deals and how more companies are utilizing carve-outs to unlock value and generate liquidity. The panel will discuss best practices for conducting due diligence and structuring the deal and review the risks and challenges unique to these transactions.
Mr. Bolotin is a partner and a member of the firm’s Tax Department and Special Situations team. His practice focuses on public and private M&A transactions across many industries, including asset managers, business services, healthcare, industrials and technology, private equity fund formation and real estate. His recent experience includes acting for clients such as Clayton, Dubilier & Rice, Kelso & Company, Prudential Capital Partners, Stone Point Capital and TPG. Mr. Bolotin advised on Chrysaor Holdings’ acquisition of a diversified North Sea oil and gas portfolio from Shell. This deal was named by the European Tax Awards as the “European Energy Tax Deal of the Year” (2018).
Ms. Chu’s practice focuses on advising corporations and private equity firms in mergers and acquisitions, joint ventures and other corporate matters, across a broad range of industries with a particular focus on transactions in the healthcare, life sciences, asset management and financial services industries. Ms. Chu is a frequent author and speaker on legal developments affecting M&A, private equity and healthcare.
Mr. Levitsky has a broad-based transactional practice advising public and private companies and private equity sponsors on mergers and acquisitions, joint ventures, and corporate governance matters. He has led transactions across many industries, including media and telecommunications, healthcare, technology, consumer and industrials. Mr. Levitsky is a frequent author and speaker on topics related to mergers and acquisitions. He is the co-author of Takeovers: A Strategic Guide to Mergers & Acquisitions (Wolters Kluwer Law & Business, 2020). Mr. Levitsky has served as a member of the New York City Bar Association’s Committee on Mergers, Acquisitions and Corporate Control Contests.
Mr. Mitchell’s practice covers a broad range of executive compensation and employee benefits matters. He advises clients on disclosure, governance, taxation, design and negotiation of executive compensation agreements and arrangements as well as the executive compensation and employee benefits aspects of mergers and acquisitions; pension investment and ERISA fiduciary matters (with significant experience on these issues in the private equity, asset management, insurance and real estate sectors); private equity compensation and governance matters at both the upper tier and portfolio company levels; and employment law and related issues.
Ms. Kassahun is corporate counsel in the Intellectual Property and Technology Transactions Group, as well as a frequent collaborator with the firm’s Data Strategy & Security practice. She is experienced in leading intellectual property and technology transactions and advising clients on related matters, including intellectual property protection, data privacy and cybersecurity. She regularly represents a broad range of clients across the technology, financial services, arts, telecommunications, private equity, entertainment, healthcare and insurance industries.
Carve-out activity has by some measures spiked in 2024, driven by the desires of corporate sellers to raise capital and focus on core strategies. A carve-out transaction is the sale of a subsidiary, division, or other smaller part of a larger business enterprise. Carve-outs allow sellers to discard businesses or noncore assets that no longer align with the company's long term goals. For buyers, carve-out transactions can provide an opportunity to grow an existing line of business.
Carve-outs are a complex business strategy involving many legal, financial, tax, and HR considerations atypical of M&A deals involving the sale of an entire business. During due diligence, deal counsel must determine how to ensure the assets that are responsible for the financial performance of an integrated business division can be transferred to produce the same financial performance when separated from a corporation's other business divisions.
When structuring the transaction, counsel must decide how to address the target company's employees, IP rights, assignment of contract rights and assets, data migration and protection, and insurance among other issues.
Listen as our authoritative panel explains strategies to implement and pitfalls to avoid with carve-out transactions and provides best practices for conducting due diligence and structuring the transaction in a way that benefits and protects both buyers and sellers.
- Unique legal and business considerations that arise in a carve-out transaction
- Identifying the parameters of the business and assets being sold
- Key due diligence considerations
- Structuring the transaction
- The role and importance of transition services agreements
- Pre and post-closing considerations to ensure the success of the transaction
The panel will review these and other important considerations:
- What are the current trends and market conditions that have spurred an increase in carve-out transactions?
- What are the unique business and legal considerations for deal counsel handling carve-out transactions?
- What are key due diligence considerations for a carve-out transaction?
- What deal terms are critical to protecting the legal and financial interests of both parties?
- What are important pre and post-closing steps deal counsel should take to ensure the success of the carve-out transaction?
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