Legal Remedies for Failed Mergers: Lost Premiums, Reverse Break Fees, and Beyond
We are pleased to invite you to a talk on Legal Remedies for Failed Mergers hosted by FOCOFIMA and Moalem Weitemeyer.
The public takeover regimes in the US and Canada are markedly different from Denmark and the rest of Europe. One distinction is that US/Canadian public takeovers are typically effectuated through a heavily negotiated merger agreement between the target company and the acquiror (which is then voted on by target company shareholders). A central question that arises in connection with these agreements is what happens when an acquirer walks away from a public company merger after agreeing to pay a premium for the target’s shares. Can the lost premium be recovered — and if so, by whom?
Although shareholders stand to benefit from the deal, they are not parties to the merger agreement, which is negotiated by the target’s board. The presentation examines the main variants of contractual compensation provisions in US/Canadian merger agreements and how they may conflict with established doctrines in contract and corporate law, raising questions about their enforceability. It then assesses proposed responses, including embedding the premium in contractual damages, reverse termination fees, agency-based recovery, and legislative reform. While each approach addresses key concerns, all face legal or practical limitations.
The programme will consist of a presentation by Professor Maziar Peihani of his recent research, with comments to follow by Danish advokat, Jacob Bier, followed by light refreshments.
Speakers
Maziar Peihani, the Lawson Lundell UBC Professor of Business Law at the Peter A. Allard School of Law, University of British Columbia, has done extensive research on the intersection of law and the financial system. Professor Peihani has published extensively on banking regulation, financial crises, financial institution restructuring, and sovereign debt markets.
Jacob Bier, Partner at Moalem Weitemeyer. Jacob Bier has more than 30 years’ experience advising on public company takeovers and mergers and will provide comments to how these issues might be viewed under Danish law.
Deadline for registration: 23 May 2025.