Latest / The Acquisition Talk with Fexingo: Mergers, Buyouts, and Business Sales for Operators
The M&A Break Fee Trap That Cost a Buyer $45 Million
When the $400 million acquisition of a cloud infrastructure company collapsed due to a surprise regulatory filing, the buyer assumed they'd get their due diligence costs back. They didn't read the break fee clause closely enough. In this episode, Lucas and Luna break down the case of ZephyrTech — a mid-market buyer that agreed to a 1.5 percent reverse break fee in a letter of intent, only to discover the fee only triggered if the target breached a material adverse condition. The target simply walked away, citing a 'change in market conditions,' which wasn't covered…
The skinny
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