In-House Counsel, Mergers and Acquisitions

Moonlighting: The Marvelous Mania of In-House M&A

Want to know what it's like to do M&A work as an in-house attorney? Susan Moon explains...

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So you like being an M&A (mergers and acquisitions) lawyer. Wonder if M&A work is different in-house compared to private practice? It’s just slightly different. Like maybe about 90% slightly different.

If you’re an M&A lawyer at a firm, your main responsibilities on a deal will be to draft the purchase agreement and other documents, actually review all of the due diligence on the company to be acquired, advise on and negotiate various legal issues, and keep track of everything that needs to be signed, filed, and otherwise happen from a legal standpoint to “close the deal.” The other primary value that outside M&A counsel provide is to inform on what’s standard and market in M&A deals and arrangements. This all sounds like a lot. And it is.

But because the tasks required of outside counsel are pretty much “pure legal” items, they’re a fraction of the amount of work that needs to be done by the in-house M&A attorney, who gets to manage all of the above, plus much of the non- or pseudo-legal stuff that the rest of the company actually cares about…

On the company side, the lawyer is often involved in most of the business aspects of the deal. You’re there from the beginning when the company first begins strategizing what kind of companies it may be interested in acquiring and why. In my opinion, this is an unnecessary step because in order to RULE THE WORLD, you have to conquer EVERYONE. *evil laughter* But for some reason, this view doesn’t seem to click with our senior executives. So instead, we do a lot of basic diligence (both legal and business) to determine which companies out there we can vanquish acquire first. There may be months of internal activity before the company picks a target company to woo. (My way would be so much quicker!)

Once a target is identified, the in-house lawyer helps keeps track of the many groups and individuals who need to be involved and at what points during the deal. It’s a delicate balance between annoying people with too many emails and annoying them by not including them on enough emails. There’s supposed to be a tiny sweet spot in there somewhere. At least, that’s what people say.

So unlike a law firm lawyer, who typically has one or two in-house lawyers for a particular matter who need to kept informed, the in-house lawyer collaborates with individuals in groups such as HR, tax, compliance, finance, insurance, IT, privacy, corporate communications, and operations, to name a few. For example, you’d need to work with HR to determine which of the employees at the target will stay on, which big shots will get employment contracts (as opposed to the majority of us who are employees at will), what employee benefit plans are in place and how they will impact the deal, etc.

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If you’re at a multi-level company, like I am (I work in one of three business units that are owned by a corporate parent), there are groups and individuals in both the business unit and the parent company whom you need to inform and collaborate with. Failing to do so means that certain risks to the company may not get identified or the deal may get delayed or even quashed. Unlike law firm attorneys, who get credit by the hour regardless of whether a deal goes through, in-house attorneys expend a lot of time and effort but receive little reward for a deal that doesn’t pan out. The weeping and gnashing of in-house counsel teeth do not make for a pretty sight.

Once a deal has “closed” (i.e., the acquisition has been successfully completed) you’re involved in post-closing legal matters, as well as general integration of the two companies. This integration is similar to when two law firms merge — there are different corporate cultures, technology and billing systems, salary models, business strategies, etc., that somebody needs to figure out whether and how to consolidate.

Of course, integrating companies is even more involved. Even something as simple as a job title can raise issues that need to be addressed. For example, the title “Associate” at a law firm has a fairly universal meaning across law firms. At companies, the title “Director” can refer to very different levels of responsibility, compensation, and employee benefits. With these differences in place when companies begin to integrate, it’s inevitable that someone’s going to feel like they got the shaft. I mean, moving from a Director title to one of Minion may make some people a bit unhappy.

So, that’s just a peek into what some of the differences are for doing M&A work at a company versus at a law firm. As at a firm, the hours are just as roller coaster-esque and we all celebrate with a drink (or ten) when a deal finally closes. Unlike at a firm, there are many pre-, during, and post- aspects of this marvelous mania that in-house lawyers need to madly manage.

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Susan Moon is an in-house attorney at a travel and hospitality company. Her opinions are her own and not those of her company. Also, the experiences Susan shares may include others’ experiences (many in-house friends insist on offering ideas for the blog). You can reach her at SusanMoonATL@gmail.com and follow her on Twitter at @SusanMoon.

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