M&A Boot Camp booklet 2023 - Flipbook - Page 56
Parties’ Mindsets in Negotiating Representations &
Warranties
Buyer’s mindset:
– “We’re paying a full price; we insist on receiving comprehensive
assurances that the target’s business conforms fully to our
expectations. Target’s stockholders should bear the risk of the
unknown.”
Target’s mindset:
– “We can only give assurances as to things we actually know about;
we’re not going to give the buyer an insurance policy. Buyer should
bear the risk of the unknown.”
Hogan Lovells US LLP
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