LPC
Study Unit Specifications (Elective Subject)
Code: UJXTS3-10-M
Title: Acquisitions & Mergers
Version: 2
Level: M-level
UWE credit rating: 10
ECTS credit rating: 5 Module Type: Non-MAR
Owning Faculty: Social Sciences and Humanities
Field: n/a Field Leader: n/a
Valid From: September 2008 Discontinued from:
Contributes towards: Postgraduate Diploma in Legal Practice
Pre-requisites: none
Co-requisites: none
Excluded combinations: none
1. Rationale:
As with all study units on the programme, the rationale is to prepare the student for the first day of work as a professional lawyer (i.e. as a new trainee solicitor in a firm of solicitors). Specifically in this case, the rationale is to prepare the student for work in a medium to large firm of commercial solicitors.
2. Learning outcomes:
On completion of the study unit students are expected to be able to (at a professional level):
2.1 Understand and critically evaluate the different types of acquisition in the UK;
2.2 Appreciate and apply the legal, commercial and taxation factors that influence the structure of an acquisition as either a share purchase or a business purchase in the context of a particular scenario;
2.3 Be familiar with and understand the roles of advisors on a share purchase or business purchase and the intellectual, legal and practical skills necessary to appropriately discharge such roles;
2.4 Understand and critically evaluate how share purchases and business purchases are carried out in practice, in particular:
- the major factors that effect the timetable and the main contractual documentation;
- how ‘due diligence’ is conducted;
- many of the most common areas of contention between parties (in relation to drafting and negotiating the contractual documentation); and
- the role of the solicitor in preparing for and carrying out exchange of contracts and completion
2.5 - engage confidently in negotiations with other professionals
2.6 - evaluate their own and others’ work by being required to provide constructive criticism on for example their colleague’s negotiation skills; and
2.7 - use research and enquiry techniques to access, interpret, critically analyse and apply relevant knowledge.
3. Syllabus outline:
The study unit introduces the student to the two main types of acquisition in the UK and the factors which influence the choice of structure of an acquisition. The study unit identifies and explains the role of the professional advisors in acquisition transactions and how such transactions are carried into effect in practice. In particular, students will consider:
(i) The different types of acquisitions in the UK:
- unincorporated businesses
- companies.
(ii) Companies: a comparison between the sale of shares and the sale of assets/ businesses as going concerns.
(iii) Share sales (1): (i) the role of the advisers (in particular, the role of the solicitor) (ii) the “timetable” for the transaction in outline, (iii) the main contractual documentation in outline (share sale agreement, disclosure letter, tax deed of indemnity).
(iv) Share sales (2): (i) due diligence / legal reviews / fact gathering / fact analysis, (ii) warranties and indemnities in a share sale agreement (drafting, negotiation, re-drafting), (iii) disclosures in a share sale agreement, (iv) taxation on the sale of shares (including deferred consideration and payments made under the warranties / indemnities), (v) exchange of contracts and completion (including, conditional contracts).
(v) *Business sales (l): (i) the role of the advisers, (ii) the “timetable” for the transaction in outline, (iii) the acquisition agreement in outline.
*Note: There will be overlap in content with paragraph (iii). The emphasis here will be on the differences between the two types of acquisition.
(vi) Business sales (2): particular aspects of the sale of a business as a going concern: Warranties, employees, pension rights, taxation, intellectual property, real property.
4. Teaching and Learning Methods:
Case Studies
We use 2 case studies during the 10 week course. The first is used during 5 workshops and concerns the purchase of the entire issued share capital of a private limited company. The second case study is used during the latter 5 workshops to facilitate the purchase of a business from a company.
Individual and Group Work
The course involves drafting and amending other people’s drafts. The subject lends itself to both individual and group work, the former when a student needs to concentrate on drafting and the latter when looking at a piece of drafting with a view to amending it.
The facts of the case study are presented to students in the form of a memo from their supervisor. Student must work in their groups to identify relevant facts and to spot legal issues that crop up.
Negotiation
Students are asked to negotiate documents during the course. They are asked to work in teams in formulating arguments and are then given the opportunity to negotiate individually.
Advice
Throughout the course students are asked to provide advice, either to their client in the form of a letter or to their supervising principal.
5. Indicative sources:
Students are referred to the LPC manual for pre-reading.
Students are referred to the relevant Companies Legislation and the FSMA 2000.
6. Assessment Infrastructure:
One 3 hour unseen, open book examination (with an additional 30 minutes of reading time).
The examination constitutes 100% of the marks for the study unit. The pass mark is 50%.
Second and final attempts: Re-assessment is by the same method as detailed above. See Assessment Regulations for further details.
Specification confirmed by .............................................. Date: ……February 2004
(Associate Dean, Faculty of Law)