Latest / The Acquisition Talk with Fexingo: Mergers, Buyouts, and Business Sales for Operators
The Reps and Warranties Trap That Cost a Buyer 30 Million
In this episode of The Acquisition Talk, Lucas and Luna dissect a specific, costly M&A mistake: a buyer who skipped the reps and warranties insurance route and paid $30 million when a seller's representation about a key patent was false. The deal was a $200 million acquisition of a medical-device firm. The seller's reps said all patents were valid. Post-close, a competitor successfully challenged the patent, wiping out the product line's value. The buyer had no recourse because the indemnification cap was $5 million and the reps and warranties policy was never purchased. Lucas…
The skinny
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