Mergers & Acquisitions

M&A Financial Solutions:

Tax Opinion Liability - Tax Opinion Liability insurance provides protection against the unanticipated deficiency in taxes and interest owed to a taxing authority attributable to a transaction. It covers a contingent tax liability arising from a successful challenge of a company's tax treatment of a transaction or investment (historical, pending or future) by the tax authorities. The tax loss covered by this insurance includes actual tax loss, the expenses of contesting the insured tax benefits and gross-ups (including penalties for negligence) which may increase a payment of tax loss by the company.

Litigation Transfer or Litigation Cap - We can structure a litigation transfer or a catastrophe cover to cap the litigation over and above the anticipated loss on a pure risk transfer or co-insurance basis. The effect is security for the client through the ring-fencing of liabilities plus the removal of a potentially deal-breaking obstacle. Typical scenarios include product liability disputes, employment conduct, anti-trust, class-actions, contractual disputes or environmental disputes.

Warranty & Indemnity Insurance - The policy provides insurance against the non-performance of general or specific warranties entered into in the sale and purchase or asset sale agreement. W&I is a "manuscript" insurance policy that is crafted to address the structure of each transaction. A W&I policy is particularly effective when used to enhance a warranty cap or to fill a warranty gap left by existing private equity vendors who refuse to provide warranties. It is the perfect foil for a purchaser seeking to protect its investment or a vendor wishing to limit it liability. It can also remove the need for an Escrow Fund. Customer Profile Any corporation, partnership or firm going through a merger or acquisition with tax or environmental liability exposures.