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‘English law governs cross-border acquisitions globally’


John Basnage

English law has successfully been exported around the world as a governing law of choice for many cross-border acquisitions, says Managing partner, Anthem Advisory, John Basnage.He made the assertion in his presentation at the Nigeria Bar Association Section on Business Law Merger and Acquisition Committee annual conference in Lagos.

According to him, many UK standard provisions used in domestic transactions appear in international share purchase agreements (SPA).“The influx of US buyers into the UK and European markets, however, has led to a creep of US formulations and concepts into transatlantic transactions even where such transactions are governed by English law,” he pointed out.He compared and contrasts the approaches taken in relation to the agreement clause, warranties and indemnities as well as disclosures of SPAs.

Dapo Okubadejo, partner and Africa head, Deal Advisory and Private Equity of KPMG noted that expected increase in merger and acquisition activity in 2018 and beyond would be driven by improved economic and financial certainty post-exit from recession.

According to him, improved ease of doing business, likely regulatory decisions to recapitalize companies in systemically important industries and improved government support for key economic sectors will attract local and foreign investors among others.He however warned that the coming elections and its attendant uncertainty may hamper such intended mergers: “The upcoming elections and increased political risk and market attractiveness may be hampered in the near term,” he stated.

The managing director, Chapel Hill Denham, Ms Kemi Awodein examined current legal developments in mergers and acquisitions, using Seven-Up Bottling Company Limited scheme of arrangement as a case study.She noted that Mergers, acquisitions, and organizational restructurings involving companies in Nigeria would most often involve the approval of the Securities & Exchange Commission (SEC) and sanctioned by the Federal High Court (FHC), subject to the transaction threshold set by the SEC.

“In order to secure the SEC approval and FHC sanction, companies/investors must engage the services of financial and legal advisers to act as intermediaries,” she declared.Chief executive officer of Zenith Capital Limited, Jubril Enakele, made a case study on corporate restructuring, with the verdict that it has some benefits to the restructuring companies. English law governs cross-border acquisitions globally’

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John Basnage
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