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Dual-Track: A Management Perspective – Part 1

12/02/2021

At a glance

Much has been heard in recent years about dual-track processes, where owners (typically, private equity funds) hedge their bets by pursuing both an IPO and M&A strategy (where the buyer, again, may well be PE) at the same time. IPO valuations, particularly for favoured sectors (such as healthcare and technology) may yield the highest value and set a benchmark for valuation on a sale. With a dual -track approach and the competitive tension that it can bring about, the chances of an attractive exit are improved. However, there are significant differences in IPO and M&A processes and there are even more fundamental differences to life as a shareholder and director in a publicly listed company on the one hand and a PE-controlled private company, on the other. The PE owner may be agnostic about the end-result if it crystallises the highest value but what of management and their shareholdings? What should their priorities and concerns be and can they do anything to influence the outcome?

In the first part of this two-parter, partner Greg Scott consider how the processes for IPO and sale to private equity differ and the onerous demands of a dual-track process.

Look out for Part Two (coming soon!) in which we will look at how life for the Directors in a listed company compares with their experience as private company directors controlled by private equity.

>>Download ‘Dual-Track: A Management Perspective – Part 1’

Our corporate team are acknowledged market leaders in advising on all aspects of mergers and acquisitions and equity capital markets having been ranked among the upper tier of law firms by both Chambers UK and The Legal 500, contact partner Greg Scott below to find out how we can help you today.

If you are a part of a management team considering a private equity backed buyout, we can help with our dedicated management advisory practice.

 

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