WEBVTT 00:00:12.380 --> 00:00:14.700 Hello. Welcome to the first module of the course. 00:00:14.700 --> 00:00:18.107 on legal aspects in the purchase and sale of startups and SMEs. 00:00:18.320 --> 00:00:21.760 My name is Juan Manuel Pérez and I am a founding partner of Aktion Legal, 00:00:21.760 --> 00:00:24.680 an office specializing in this type of operations. 00:00:25.100 --> 00:00:27.760 I'm glad you're here to explore together 00:00:27.760 --> 00:00:31.145 the world of business sales, better known as M&A 00:00:31.145 --> 00:00:33.050 for its acronym in English. 00:00:33.560 --> 00:00:35.810 You may have heard of this before, 00:00:35.810 --> 00:00:38.340 or maybe it's a completely new term for you. 00:00:38.340 --> 00:00:39.267 Don't worry. 00:00:39.267 --> 00:00:41.360 We are here to clear up all your doubts. 00:00:41.700 --> 00:00:43.100 Let's start with the basics. 00:00:43.100 --> 00:00:44.240 What is this M&A thing? 00:00:44.520 --> 00:00:46.278 When we talk about M&A we refer to 00:00:46.278 --> 00:00:48.440 basically the purchase or sale of companies. 00:00:48.440 --> 00:00:50.670 It is a process that is certainly complex 00:00:50.900 --> 00:00:55.040 and which, logically, consists of a company being acquired by a third party, 00:00:55.340 --> 00:00:58.340 whether it is an industrial buyer, a fund, etc. 00:00:58.740 --> 00:01:00.120 Now you might be wondering: 00:01:00.120 --> 00:01:03.590 How can this type of operation benefit your startup or SME? 00:01:03.980 --> 00:01:06.240 Imagine, for example, that you have a company 00:01:06.240 --> 00:01:09.540 with an innovative product, but you need resources to grow and scale. 00:01:09.800 --> 00:01:12.986 Well, an M&A operation, in which you acquire another company, 00:01:12.986 --> 00:01:15.680 could provide you with the capital, the infrastructure 00:01:15.680 --> 00:01:19.160 and the support needed to take your business to the next level. 00:01:19.380 --> 00:01:23.160 In addition, you could access a wider network of clients and collaborators. 00:01:23.840 --> 00:01:26.360 Conversely, if you're considering selling your company 00:01:26.360 --> 00:01:29.220 an acquisition by another company in the sector or by a fund 00:01:29.520 --> 00:01:32.700 It can be a great way to capitalize on your investment and see 00:01:33.020 --> 00:01:36.300 how your creation continues to grow under new direction. 00:01:36.900 --> 00:01:40.820 In short, an M&A transaction can help you grow quickly, 00:01:40.860 --> 00:01:44.340 access new markets or products, or even solve 00:01:44.540 --> 00:01:45.960 financial problems. 00:01:45.960 --> 00:01:49.140 Sometimes selling your company to a larger company or to a fund 00:01:49.140 --> 00:01:52.140 is the best way to secure your future. 00:01:52.460 --> 00:01:55.770 In addition, as an entrepreneur or owner of an SME, you could receive 00:01:55.940 --> 00:01:58.270 an interesting financial reward. 00:01:58.640 --> 00:02:02.000 Startups and SMEs are often in an interesting position 00:02:02.000 --> 00:02:03.200 in the world of M&A 00:02:03.200 --> 00:02:06.380 precisely because they have significant growth potential. 00:02:06.380 --> 00:02:09.520 Large companies seek to acquire innovation and also 00:02:09.520 --> 00:02:12.520 new technologies and that's where startups shine. 00:02:12.720 --> 00:02:16.050 In short, M&A operations are a powerful tool 00:02:16.257 --> 00:02:20.280 that can open doors for your business that you may not have considered. 00:02:20.780 --> 00:02:22.030 Throughout this course 00:02:22.030 --> 00:02:25.760 you'll learn to seize those opportunities effectively and safely 00:02:26.120 --> 00:02:29.820 and how to navigate the various legal aspects most relevant to that process. 00:02:30.200 --> 00:02:33.490 Now that we have established, in broad terms, what this M&A thing is 00:02:33.840 --> 00:02:35.485 and how it can be useful for you, 00:02:35.485 --> 00:02:36.960 Let's go with the basics 00:02:36.960 --> 00:02:39.720 and the usual structure of an M&A process. 00:02:39.720 --> 00:02:40.740 Let's get to it. 00:02:41.060 --> 00:02:45.380 An M&A process generally follows several stages, six stages. 00:02:45.660 --> 00:02:48.940 The first, the initial stage, would be that of preparation. 00:02:48.960 --> 00:02:51.960 The objectives are defined and the process is prepared. 00:02:52.400 --> 00:02:53.910 What are you looking for? Sell? 00:02:53.910 --> 00:02:56.760 Merge with another company? Acquire another company? 00:02:57.500 --> 00:03:01.080 It is essential to be clear about all this from the beginning. 00:03:01.500 --> 00:03:04.800 Then there would come a phase of searching and making contacts. 00:03:05.120 --> 00:03:06.930 Once the objectives have been defined, 00:03:06.930 --> 00:03:10.320 It is about identifying potential companies that align with your goals. 00:03:10.440 --> 00:03:13.760 This may involve approaching potential buyers or sellers. 00:03:14.040 --> 00:03:17.960 and the normal thing is to do it with the help of advisors specialized in M&A, 00:03:18.080 --> 00:03:21.080 financial advisors, as we will see later, who will direct 00:03:21.300 --> 00:03:24.700 the sales process in an organized manner, usually through 00:03:24.720 --> 00:03:27.400 of a competitive process to maximize price. 00:03:27.740 --> 00:03:30.740 Although there may sometimes be processes that are 00:03:30.860 --> 00:03:33.860 one to one, not directly with a counterparty, 00:03:34.320 --> 00:03:36.550 directly with a previously selected buyer. 00:03:36.960 --> 00:03:37.710 OK. 00:03:37.710 --> 00:03:43.220 Next, a stage begins with the various preliminary agreements. 00:03:44.160 --> 00:03:48.060 Before sharing sensitive information and moving forward in the process, 00:03:48.060 --> 00:03:50.690 the normal thing is to sign a confidentiality agreement 00:03:50.690 --> 00:03:54.300 to protect both parties and a preliminary agreement of intentions. 00:03:54.720 --> 00:03:56.620 We will see it in detail below. 00:03:56.830 --> 00:03:59.315 But you should keep in mind at this point that 00:03:59.315 --> 00:04:03.040 The terms of the transaction are negotiated in this agreement of intentions 00:04:03.440 --> 00:04:06.620 and the main aspects such as price and other conditions. 00:04:06.840 --> 00:04:09.710 The next typical stage is due diligence, 00:04:09.710 --> 00:04:12.196 which consists of an exhaustive investigation 00:04:12.196 --> 00:04:16.220 where financial, legal and operational aspects of the company are analyzed . 00:04:16.680 --> 00:04:20.040 Basically, the purchasing company does a thorough investigation. 00:04:20.060 --> 00:04:22.940 which is going to be acquired and reviewed from the finances 00:04:22.940 --> 00:04:25.940 to contracts, employees and any legal issues. 00:04:26.300 --> 00:04:29.392 We will see this point later, but it is as if you were reviewing 00:04:29.392 --> 00:04:31.840 every corner of a house before buying it. 00:04:32.260 --> 00:04:34.460 Finally, once the process has advanced, 00:04:34.460 --> 00:04:37.560 we have the sales contract and the closing of the transaction. 00:04:37.560 --> 00:04:40.940 In this decisive phase the sales agreement is negotiated and formalized. 00:04:40.940 --> 00:04:42.610 and the transaction is completed. 00:04:42.900 --> 00:04:46.003 In later modules we will see all the relevant aspects 00:04:46.003 --> 00:04:48.720 of the sales contract and the closing of the transaction. 00:04:48.720 --> 00:04:51.640 After closing comes the integration phase, 00:04:51.640 --> 00:04:53.400 in which work is being done to combine 00:04:53.400 --> 00:04:56.160 the operations of both companies effectively. 00:04:56.420 --> 00:04:59.340 As you can see, a typical M&A process has several stages. 00:04:59.340 --> 00:05:02.340 and all of them are crucial to ensure a successful operation. 00:05:02.660 --> 00:05:05.680 Knowing this structure will help you navigate the process. 00:05:05.680 --> 00:05:08.900 with more confidence and understanding what to expect at each stage. 00:05:09.260 --> 00:05:12.960 We will see the details of each of these stages throughout the course. 00:05:13.280 --> 00:05:16.880 For now, the idea is that you become familiar with the most common steps. 00:05:17.180 --> 00:05:20.520 and that you internalize some of the most relevant concepts. 00:05:20.520 --> 00:05:24.320 See you in the next video where we will discuss who the actors are. 00:05:24.320 --> 00:05:27.300 and what are the usual risks in this type of process. 00:05:27.300 --> 00:05:29.040 See you in the next video.