Special considerations for structuring and managing a cross-border acquisition of a U.S. target company

Abstract

The purpose of this chapter is to provide an overview of specific considerations for the transaction structuring and management phase when acquiring a U.S. target company. As mentioned earlier, the main concerns and risks for a foreign acquirer for the structure and management of a cross-border transaction result from the impact of the local institutional peculiarities of the target’s country. This presentation of U.S. specific considerations begins with laying out the possible structures for the U.S. transaction, which is focused on the implications of the U.S. securities laws applicable to the acquisition of a public target company (Section 3.2). Following is a discussion about conducting a due diligence for a U.S. target, with an emphasis on the U.S. accounting and legal environment (Section 3.3). Also of particular interest for a foreign acquirer are tax consequences of alternative acquisition structures (Section 3.4), various aspects for the valuation (Section 3.5), and the principal documentation (Section 3.6) of the U.S. transaction. After a brief description of the U.S. regulatory framework of antitrust laws (Section 3.7), a summary of the main implications for the acquisition structuring and management phase concludes this chapter.