Major changes to your business can be bittersweet. When you decide to acquire another business or merge with a company, for example, it can bring about some unique pros and cons for the future. Unfortunately, some of these changes can also put you in a difficult legal position. In order to protect your company as it moves through these complicated shifts, you should do yourself a favor and understand some of the more common legal issues you might encounter.
Understanding the ins and outs of mergers and acquisitions litigation begins with assessing the risks inherent in such arrangements. On the surface, these decisions come with some obvious downsides. If you’re merging with another large business, it stands to reason you will need to let some people go in order to make the budget work. No matter who the employees are or where they originated, this can create some tense or complicated situations during a merger. If you let someone go who was bound by a contract, it could lead to a lawsuit. Other points to consider include:
- Errors and omissions liability coverage
- Protections for directors and officers
- Benefit enrollment periods
Take the Right Steps
By understanding all of the various problems that can occur during a merger or acquisition, you can do your part to avoid a disaster. Review your options and see how a few smart changes can make a world of difference during this period.