{"id":44122,"date":"2017-11-26T16:09:56","date_gmt":"2017-11-26T14:09:56","guid":{"rendered":"https:\/\/newserver.fyb.de\/produkt\/risk-allocation-and-risk-hedging-in-the-acquisition-of-companies\/"},"modified":"2017-11-26T16:09:56","modified_gmt":"2017-11-26T14:09:56","slug":"risk-allocation-and-risk-hedging-in-company-acquisitions","status":"publish","type":"product","link":"https:\/\/www.fyb.de\/en\/produkt\/risk-allocation-and-risk-hedging-in-company-acquisitions\/","title":{"rendered":"Risk allocation and risk hedging in the acquisition of companies"},"content":{"rendered":"<p><strong>Dr. Matthias Bruse, LL.M.<\/strong>  \u2014 Lawyer and Part\u00adner P+P P\u00f6llath + Part\u00adners, Munich<\/p>\n","protected":false},"excerpt":{"rendered":"<p><strong>The follo\u00adwing article aims to provide an over\u00adview of current trends in the contrac\u00adtual agree\u00adment of risk allo\u00adca\u00adti\u00adons in the rela\u00adti\u00adonship between seller and buyer in a company purchase agree\u00adment. The agree\u00adment on which method is chosen depends in parti\u00adcu\u00adlar on the circum\u00ads\u00adtances of the indi\u00advi\u00addual case and the nego\u00adtia\u00adting power of the respec\u00adtive parties. Ther\u00ade\u00adfore, there are rather no fixed rules, but diffe\u00adrent tech\u00adni\u00adques that have deve\u00adlo\u00adped in practice.<\/strong><\/p>\n<p>Indi\u00advi\u00addual risk allo\u00adca\u00adti\u00adons in favor of the buyer and at the expense of the seller<\/p>\n<ul>\n<li><strong>Purchase price<\/strong><\/li>\n<\/ul>\n<p>A purchase price discount is a tool that is not infre\u00adquently used to reduce the value of an anti\u00adci\u00adpa\u00adted risk. The purchase price discount leads to an anti\u00adci\u00adpa\u00adtion of the occur\u00adrence of the risk (possi\u00adbly with a certain proba\u00adbi\u00adlity) for nego\u00adtia\u00adtion purpo\u00adses. The poten\u00adtial future loss, a mate\u00adria\u00adliza\u00adtion of the risk, results in a purchase price discount that directly bene\u00adfits the buyer, regard\u00adless of whether a loss event actually occurs. If the risk mate\u00adria\u00adli\u00adzes in the future, further possi\u00adbi\u00adli\u00adties for recourse on the part of the purcha\u00adser are gene\u00adrally excluded in the event of a purchase price discount (avoid\u00adance of a so-called double dip).<\/p>\n<ul>\n<li><strong>Guarantees\/ Warran\u00adties<\/strong><\/li>\n<\/ul>\n<p>Guaran\u00adtees or warran\u00adties are the \u201cclas\u00adsic\u201d instru\u00adment in a company purchase agree\u00adment to protect the buyer from certain risks rela\u00adting to the company or its shares. As a rule, guaran\u00adtees describe a target state that exists at signing or closing (gene\u00adrally not after\u00adwards!). If the actual state devia\u00adtes adver\u00adsely from the target state, the risk mate\u00adria\u00adli\u00adzes. In this case, the seller must usually provide in rem resti\u00adtu\u00adtion and\/or compensation.<\/p>\n<ul>\n<li><strong>Exemp\u00adti\u00adons<\/strong><\/li>\n<\/ul>\n<p>Exemp\u00adti\u00adons are parti\u00adcu\u00adlarly common in the area of taxes, but also envi\u00adron\u00admen\u00adtal risks or other risks speci\u00adfi\u00adcally iden\u00adti\u00adfied during due dili\u00adgence. In devia\u00adtion from guarantees\/warranties, the seller assu\u00admes vis-\u00e0-vis the buyer the risk of future burdens on the company, e.g. for future tax payments that arise retro\u00ads\u00adpec\u00adtively for assess\u00adment peri\u00adods that have expi\u00adred at signing or closing.<\/p>\n","protected":false},"featured_media":41139,"comment_status":"open","ping_status":"closed","template":"","meta":{"wp_typography_post_enhancements_disabled":false},"product_brand":[],"product_cat":[2452,2506,2579],"product_tag":[1887,1900,1902,1908,1916,1923],"class_list":{"0":"post-44122","1":"product","2":"type-product","3":"status-publish","4":"has-post-thumbnail","6":"product_cat-ebook-en","7":"product_cat-fyb-2011-en","8":"product_cat-dr-matthias-bruse-ll-m","9":"product_tag-matthias-bruse-en","10":"product_tag-company-purchase-agreement","11":"product_tag-purchase-price","12":"product_tag-guarantees","13":"product_tag-warranties","14":"product_tag-exemptions","15":"pa_sprache-english-3","16":"pa_sprache-german","18":"first","19":"outofstock","20":"taxable","21":"shipping-taxable","22":"purchasable","23":"product-type-variable"},"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.1 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Risk allocation and risk hedging in the acquisition of companies - FYB Financial Yearbook<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.fyb.de\/en\/produkt\/risk-allocation-and-risk-hedging-in-company-acquisitions\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Risk allocation and risk hedging in the acquisition of companies - FYB Financial Yearbook\" \/>\n<meta property=\"og:description\" content=\"The following article aims to provide an overview of current trends in the contractual agreement of risk allocations in the relationship between seller and buyer in a company purchase agreement. The agreement on which method is chosen depends in particular on the circumstances of the individual case and the negotiating power of the respective parties. Therefore, there are rather no fixed rules, but different techniques that have developed in practice. Individual risk allocations in favor of the buyer and at the expense of the seller  Purchase price A purchase price discount is a tool that is not infrequently used to reduce the value of an anticipated risk. The purchase price discount leads to an anticipation of the occurrence of the risk (possibly with a certain probability) for negotiation purposes. The potential future loss, a materialization of the risk, results in a purchase price discount that directly benefits the buyer, regardless of whether a loss event actually occurs. If the risk materializes in the future, further possibilities for recourse on the part of the purchaser are generally excluded in the event of a purchase price discount (avoidance of a so-called double dip).  Guarantees\/ Warranties Guarantees or warranties are the &quot;classic&quot; instrument in a company purchase agreement to protect the buyer from certain risks relating to the company or its shares. As a rule, guarantees describe a target state that exists at signing or closing (generally not afterwards!). If the actual state deviates adversely from the target state, the risk materializes. In this case, the seller must usually provide in rem restitution and\/or compensation.  Exemptions Exemptions are particularly common in the area of taxes, but also environmental risks or other risks specifically identified during due diligence. In deviation from guarantees\/warranties, the seller assumes vis-\u00e0-vis the buyer the risk of future burdens on the company, e.g. for future tax payments that arise retrospectively for assessment periods that have expired at signing or closing.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.fyb.de\/en\/produkt\/risk-allocation-and-risk-hedging-in-company-acquisitions\/\" \/>\n<meta property=\"og:site_name\" content=\"FYB Financial Yearbook\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.fyb.de\/wp-content\/uploads\/2017\/07\/Bruse.png\" \/>\n\t<meta property=\"og:image:width\" content=\"334\" \/>\n\t<meta property=\"og:image:height\" content=\"298\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/png\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.fyb.de\/en\/produkt\/risk-allocation-and-risk-hedging-in-company-acquisitions\/\",\"url\":\"https:\/\/www.fyb.de\/en\/produkt\/risk-allocation-and-risk-hedging-in-company-acquisitions\/\",\"name\":\"Risk allocation and risk hedging in the acquisition of companies - FYB Financial Yearbook\",\"isPartOf\":{\"@id\":\"https:\/\/www.fyb.de\/en\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.fyb.de\/en\/produkt\/risk-allocation-and-risk-hedging-in-company-acquisitions\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.fyb.de\/en\/produkt\/risk-allocation-and-risk-hedging-in-company-acquisitions\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.fyb.de\/wp-content\/uploads\/2017\/07\/Bruse.png\",\"datePublished\":\"2017-11-26T14:09:56+00:00\",\"breadcrumb\":{\"@id\":\"https:\/\/www.fyb.de\/en\/produkt\/risk-allocation-and-risk-hedging-in-company-acquisitions\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.fyb.de\/en\/produkt\/risk-allocation-and-risk-hedging-in-company-acquisitions\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.fyb.de\/en\/produkt\/risk-allocation-and-risk-hedging-in-company-acquisitions\/#primaryimage\",\"url\":\"https:\/\/www.fyb.de\/wp-content\/uploads\/2017\/07\/Bruse.png\",\"contentUrl\":\"https:\/\/www.fyb.de\/wp-content\/uploads\/2017\/07\/Bruse.png\",\"width\":334,\"height\":298},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/www.fyb.de\/en\/produkt\/risk-allocation-and-risk-hedging-in-company-acquisitions\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/www.fyb.de\/en\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"FYB Shop\",\"item\":\"https:\/\/www.fyb.de\/en\/shop\/\"},{\"@type\":\"ListItem\",\"position\":3,\"name\":\"Risk allocation and risk hedging in the acquisition of companies\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/www.fyb.de\/en\/#website\",\"url\":\"https:\/\/www.fyb.de\/en\/\",\"name\":\"FYB Financial Yearbook\",\"description\":\"For Your Business\",\"publisher\":{\"@id\":\"https:\/\/www.fyb.de\/en\/#organization\"},\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/www.fyb.de\/en\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Organization\",\"@id\":\"https:\/\/www.fyb.de\/en\/#organization\",\"name\":\"FYB Financial Yearbook\",\"url\":\"https:\/\/www.fyb.de\/en\/\",\"logo\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.fyb.de\/en\/#\/schema\/logo\/image\/\",\"url\":\"https:\/\/www.fyb.de\/wp-content\/uploads\/2020\/06\/logo.svg\",\"contentUrl\":\"https:\/\/www.fyb.de\/wp-content\/uploads\/2020\/06\/logo.svg\",\"caption\":\"FYB Financial Yearbook\"},\"image\":{\"@id\":\"https:\/\/www.fyb.de\/en\/#\/schema\/logo\/image\/\"}}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Risk allocation and risk hedging in the acquisition of companies - FYB Financial Yearbook","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.fyb.de\/en\/produkt\/risk-allocation-and-risk-hedging-in-company-acquisitions\/","og_locale":"en_US","og_type":"article","og_title":"Risk allocation and risk hedging in the acquisition of companies - FYB Financial Yearbook","og_description":"The following article aims to provide an overview of current trends in the contractual agreement of risk allocations in the relationship between seller and buyer in a company purchase agreement. 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If the risk materializes in the future, further possibilities for recourse on the part of the purchaser are generally excluded in the event of a purchase price discount (avoidance of a so-called double dip).  Guarantees\/ Warranties Guarantees or warranties are the \"classic\" instrument in a company purchase agreement to protect the buyer from certain risks relating to the company or its shares. As a rule, guarantees describe a target state that exists at signing or closing (generally not afterwards!). If the actual state deviates adversely from the target state, the risk materializes. In this case, the seller must usually provide in rem restitution and\/or compensation.  Exemptions Exemptions are particularly common in the area of taxes, but also environmental risks or other risks specifically identified during due diligence. 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