Chapter

Structuring the Transaction

Richard J. Joseph and Bill Ryan

in The Handbook of Mergers and Acquisitions

Published in print June 2012 | ISBN: 9780199601462
Published online September 2012 | e-ISBN: 9780191743320 | DOI: http://dx.doi.org/10.1093/acprof:oso/9780199601462.003.0009
Structuring the Transaction

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This chapter discusses various strategic, institutional, operational, and regulatory factors that influence how mergers and acquisitions (M&A) transactions are structured. It elaborates on the “continuity of interest” principle, a judicial doctrine that underlies the whole of deal structuring in the United States. It sets forth the advantages and disadvantages of a stock purchase versus an asset purchase, as well as the use of cash versus stock as consideration. It critiques conventional accounting methods by which transactional outcome has been analyzed. Finally, it places deal structuring in a broader market context, with particular emphasis on recent trends in the United States and Europe.

Keywords: deal structuring; continuity of interest; stock purchase; asset purchase; regulations; accounting

Chapter.  7847 words.  Illustrated.

Subjects: Financial Institutions and Services

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