Aug 23, 2012
New York M&A partner David Connolly and associate Zhak Cohen published an article, "Everybody's Got a Hungry Heart: Navigating Conflicts in Change of Control Transactions," in the June issue of The M&A Lawyer.
The article looks at the Chancery Court's recent decisions in Southern Peru Copper, El Paso, Delphi Financial and Del Monte—decisions that have increased the attention given to conflicts of interest arising in change of control transactions, leading some to observe that they have become "a cost of doing business on Wall Street these days." According to the authors, conflicts have always been a part of the deal-making process and the same scrutiny of self-interest that guided the Chancery Court's analysis in Revlon shapes the analysis of change of control transactions, and the actions of transaction participants, today. The authors offer several key steps in handling conflicts in change of control transactions: identify them early; disclose them appropriately; determine whether they can be mitigated; and, when mitigation is possible, mitigate them effectively.