Adam Dowdney, partner and corporate and commercial lawyer at IBB Solicitors, West London, discusses the potential impact of the UK leaving the EU- on the UK mergers and acquistions market. For more information on the topic or to contact Adam please visit: http://www.ibblaw.co.uk/people/adam-dowdney To contact our corporate and commercial lawyers please visit: http://www.ibblaw.co.uk/service/corporate-and-commercial For legal advice on mergers, acquisitions and disposals please see: http://www.ibblaw.co.uk/service/corporate-and-commercial/acquisitions-mergers-and-disposals Corporate and Commercial Legal Team IBB Solicitors Capital Court 30 Windsor Street Uxbridge UB8 1AB Tel: 03456 381381

1. IBB Solicitors Corporate and Commercial Team
Published in EU Bankers
May 10 2016
03456 381381
ibblaw.co.uk
Potential implications Brexit will have on the M&A Market
by Adam Dowdney, Partner, IBB Solicitors
Over 50% of all European deals in 2015 took place in the UK, as the UK M&A market re-established itself as one of
the most dynamic markets for domestic and cross-border transactions. While European M&A activity increased
in Q1 2016, the UK saw a slowdown.
Is this downturn related to the forthcoming Brexit referendum, or are there other reasons behind the reversal?
What is at stake?
At stake is London’s position as Europe’s key deal making centre. The UK currently offers financial companies and
advisers a fully functioning economic base and Brexit will affect that. Analysts do not anticipate significant changes
to the Takeover Code, so there is unlikely to be an impact on public company M&A.
UK equity capital markets are probably not at risk, as, although much of the regulatory framework comes from the
EU, most EU legislation is enshrined and enhanced in UK legislation,so any post-Brexit scaling back of the regula-
tions should be limited.
Current market forces
Recent increased UK M&A is due to improved funding availability – from traditional and “alternative” sources –pro-
viding cash for willing buyers, and excess private equity funds that need investing coupled with low interest rates
and general market stability.
The current slowdown could be a result of the Chinese and global economic downturn, US debt markets, falling oil
prices and the Middle East crisis. Along with general market volatility, these factors create a hostile environment for
M&A.
Potential Brexit consequences
What relationship would the UK have with the EU and international trading partners in a post-Brexit world?
Economic forecasts vary wildly. Any exit would be a heavily negotiated and managed process, so in spite of initial
uncertainty, it is unlikely– from a legal perspective – that Brexit would affect existing or new transactions. But would
uncertainty mean that acquirers and sellers hold off on M&A activity?
Were the UK to exit the EU, it could take up to four years from a ‘leave’ vote, during which time many transactions
would complete or mature. Agreements already completed (and therefore in warranty or earn-out periods) are
unlikely to need detailed amendments. However, there may be more of an effect on asset and business sales if there
are amendments to the regulations that protect the rights of employees on a transfer.
While exit terms are negotiated, we would see greater focus on the allocation of risk between sellers and buyers in
cross-border European deals, to allow for unforeseen consequences. This could mean decreased valuations and
greater deal uncertainty EU Merger Regulation regulates qualifying proposed M&A activity involving companies
operating within Europe, and uncertainty could affect deals that currently require EU Merger clearance.
UK legislation, recognised for the strength of its well-defined regulatory framework, runs parallel to the relevant EU
Provisions.

2. IBB Solicitors Corporate and Commercial Team
Published in EU Bankers
May 10 2016
03456 381381
ibblaw.co.uk
Potential implications Brexit will have on the M&A Market
by Adam Dowdney, Partner, IBB Solicitors
Brexit is unlikely to substantially alter UK competition regulation, however, if the post-Brexit UK regulatory frame-
work deviates drastically from EU standards, we will only know the extent of ensuing procedural and legal issues
once the dust settles. Inevitable uncertainty will accompany whatever agreement the UK negotiates over UK-EU
trade – whether Norwegian-style, bilateral agreements similar to Switzerland, or a WTO-type arrangement without
free trade agreement which could well lead to a see a reduction in UK M&A.
What can we expect?
It is difficult to predict what impact Brexit might have on UK M&A, though the current slowdown indicates a reaction
to the upcoming referendum that could perpetuate uncertainty if the vote is to leave.
However, businesses have known about the referendum for some time and large deals are still in the pipeline.
Companies like doing business in the UK because of stable financial, regulatory and legal systems and favourable
corporation tax rates, and the UK has come out of the global recession in better shape than much of Europe.
Brexit itself should not have a direct impact on doing deals in the UK, but in the short to medium term, timing and
business confidence may still be affected.
To satisfy investors, businesses and the public, suitable deals for a post-Brexit UK will need to be agreed, but the
generally favourable UK market and its ability to adapt to a new environment should mean continued growth in UK
M&A activity, even after a temporary lull, in a slow-growth global economy.
Adam Dowdney
Adam Dowdney is a Partner in the Corporate and Commercial department at IBB which has a very strong reputation
in Uxbridge and the surrounding area. Adam specialises in all aspects of corporate finance work, including merg-
ers and acquisitions, MBOs/MBIs, private equity transactions (acting for both management and investment entities),
restructurings, joint ventures, shareholder agreements and general company law matters. Adam has worked on a
number of large, high-profile and complex transactions across a broad range of business sectors and he won “Law-
yer of the Year” at the 2011 Thames Valley & Solent Business Award and is ranked as a leading individual in Legal
500 and Chambers.
To discuss any matters raised in this article please contact Adam on 01895 207264 or adam.dowdney@ibblaw.co.uk.