M&A insurance holds answers for buying and selling companies in these volatile times
Today Aon Belgium, provider of risk management, insurance brokerage, reinsurance brokerage and human resource solutions, held a webinar on Mergers & Acquisition Insurances which can hold answers and solutions for companies who are economically challenged in the COVID-19-era and who search for optimal ways to insure the interests of both the side of the seller as the buyer.
Aon Belgium’s CEO Philip Alliet: “COVID-19 has changed a lot in the deal market. However these last few weeks we saw new activity and were able to support clients with transactional solutions both on the sale and the buy side. Solutions such as W&I (Warrant & Indemnity) are increasingly being used by equity funds and strategic buyers. In the UK and the Netherlands they are used very frequently – in more than 1 out of 3 cases - because of the value they generate for the deal parties.”
He furthermore talked specifically of the Belgian market: “Looking to what these solutions do in central Europe, we have - as a service provider to our clients – invested in local resources advising local decision makers on capacity and solutions. Clients mandated us in over 50 cases already to help them realize M&A solutions in the last few months. With good results to help out the economically challenged enterprises.”
An in depth presentation was held by Bert Van Camp, Senior Broker M&A and Transaction Solutions, whereby he explained that W&A Insurance can reconcile the need of a purchaser for security of payment versus the need of a seller of free availability of the purchase price. He emphasized that certain insurance solutions can even provide warranty cover when sellers are not able to give any warranty. “W&I Insurance can unlock difficult negotiations between sellers and purchasers which can help avoid sellers filing for bankruptcy of the subsidiary they intend to sell. Bankruptcy receivers, credit institutions and other governmental representatives that cannot offer any warranties, can via M&A Insurance still provide comfort to a purchaser when selling distressed assets thereby avoiding a final bankruptcy of the distressed company with loss of jobs.”, Bert Van Camp adds.