Client’s Requirement: The clients (which represents more than twenty individual interests) are interested in selling to its current strategic partner its indirect ownership of 50% of the outstanding shares of a leading company in the Peruvian maritime transportation services sector. Our Participation: We have advised the clients in the structuring, negotiation and drafting of all transaction documents as well as in all necessary corporate actions to be adopted and in its preparation for the due diligence process it will be subject to. We have counselled the Clients in the negotiation of several Ancillary Documents such as the amendments of the services agreements between the companies of the group that will be affected due to the change in the control of the target company. We have advised the clients in the closing of the transaction and the final negotiation of the ancillary documents to be executed at closing.
Deal Challenges: As a condition to implement the transaction the target company shall be free and clear of any other obligation (liability) in its accounting. Therefore, we structured an implement a spin-off to carve-out all other obligations and rights from the Target´s patrimony. Additionally, having in consideration that the transaction had to go through a prior authorization before the Merger Control Authority the share purchase agreement included different provisions that covered the Sellers interest to such exposure and maintain the value of the Purchase Price. Since the process of merger control in Peru is new, it was uncertain the time period such authorization process may take (between 3 to 12 months). Moreover, since the sellers included a Foundation as owner of certain shares, we had to assist on the authorization process before the Supervisor of Foundations in Peru.
