M&A Monday: Strategy for Dealing with a Seller’s Lawyer Who Is Not an M&A L

M&A Monday: Dealing with a Seller’s Non-M&A Lawyer
As buyer’s counsel on small and middle market M&A deals, I encounter sellers represented by a whole range of lawyers. I wish them well, but here is my strategy for dealing with a seller’s counsel who lacks M&A experience.
Each Monday I post one lesson buyers or sellers of a business should know. I learned these tips representing top private equity groups and learning from some of the best M&A lawyers in the world. These are tips that can and should be applied to smaller buyers and sellers.

There is no certification to be an M&A lawyer. It is learned through years of experience, dedication, and repetition. The only way to get good at M&A is by doing tons of M&A. Often founder-sellers will choose a lawyer to represent them on a transaction they feel comfortable with but are not suited. Sometimes this is a family lawyer, a litigator, or a generalist. I'll call these lawyers, non-M&A counsel.

This is like having a pediatrician do a heart transplant because they are a doctor. Technically, yes, they can (barring state regulations), but it is a bad idea.

Having non-M&A seller’s counsel is bad for seller and kills deals. They give poor advice to their clients, argue unreasonable positions, and delay deals. Ultimately, a good M&A lawyer will run circles around them, but it can be a challenge.

When representing a buyer, this is my gameplan for non-M&A counsels:

1. Gage the situation. Within moments of looking at a lawyer’s bio I can tell if they are an M&A lawyer or not.

2. Develop a collaborative approach. This is the most important step. All else will hinge on this step. I call seller’s counsel at the start of a deal. I tell them I do not view M&A as 0-sum transaction and communicate that if we do this right, there are two winners.

3. Keep documents short. M&A lawyers may not flinch at an 85-page purchase agreement, but non-M&A counsel will not be happy.

4. Include explanations. For each substantive revision I make, I include a footnote explanation. I will include a cover email with explanations of major issues.

5. Develop a backchannel with seller’s lawyer. I tell seller’s lawyer they should call me on my cell if something seems confusing, overly aggressive, or burdensome. Many deals are hurt by misunderstandings. I want seller’s lawyer to call me first to clarify before calling their client and creating a crisis. I also want them to know I am happy to explain a provision and there is no shame in asking (since we are working together, anyway).

6. Never call out the lawyer in front of their clients. This is a guaranteed way to kill a deal for your client.

7. Be patient. Do whatever meditation and deep breathing needed to be patient. Even if you feel like tearing your hair out because seller’s counsel is removing all reps and warranties and the deal is taking 10x as many hours as budgeted, try to be patient. Remember the main goal is to close the deal for your client.

Dealing with non-M&A counsel can be a challenge, but if navigated correctly, will result in a better deal for the buyer.