Tips on Mergering Chemical Businesses
There are some interesting movements being made today in chemical mergers and acquisitions. Now, more than ever, companies are using advisory teams to ensure that they don’t lose any profits and get the best end of the deal in negotiations. For that, it is essential to hire a knowledgeable and experienced chemical M&A advisory firm.
Chemical and related industries often go through challenges when merging. There are issues with environmental liabilities, operational carve-outs, ongoing supply agreements, off-take agreements, intellectual property rights, site operating agreements, regulatory constraints and non-compete agreements. Without the right advisory team working on your company’s side, it can be a giant hassle to come out on top of a merger.
One of the major things that companies face in a chemical merger is regulatory constraints and environmental liabilities. The main part that an advisory team helps with is negotiation. It can be difficult to go head-to-head with another company’s team especially if they also have lawyers and advisers that are working hard to negotiate for a better result.
In this instance, you need a team that has handled thousands of chemical mergers before and can create a deal that is both beneficial to your company and the old. Many businesses also encounter situations where facilities and equipment need to be carved out. This is a touchy negotiation and requires the expertise of an advisory team who has worked with other chemical company carve-outs.