Anticipated Spike in Deal Activity in 2021 Makes Customized R&W Insurance Critical, Finds Lowenstein Sandler | Coronavirus – About Your Online Magazine

NEW YORK – (BUSINESS WIRE) – November 11, 2020 –

Encouraging news about the COVID-19 vaccination tests and the imminent resolution of the long electoral process bodes well for business activity in 2021, according to M&A and insurance recovery lawyers from Lowenstein Sandler. With an expected increase in financial transactions, competition between insurance companies should also heat up, making this an ideal time for private equity funds, investment banks and operating companies to implement representation and guarantee (R&W) policies carefully designed to protect themselves in the future. .

Business activity over the past decade has spurred the growth of R&W insurance – an alternative risk transfer mechanism to indemnify buyers for violations arising from a seller’s misrepresentation in procurement contracts. As reported in the company’s recent publication Getting paid: an analysis of insurance claims and guarantees, R&W insurance has become so popular that, to be considered competitive bidders, “buyers are increasingly obliged to include this insurance as a business term,” he says. Lynda A. Bennett, partner and president of Lowenstein’s Insurance Recovery Group, and co-author of the report with the lawyer Eric Jesse. It predicts that the resumption of business activity in the last quarter of 2020 and in 2021 will result in “strong competition, falling premiums and reduced SIRs over time, as well as greater leverage for policyholders to negotiate the terms of the policy”.

Lowenstein’s Fusions and acquisitions The group saw business activity slow down slightly in the first months of the pandemic, only to increase dramatically in recent months.

The company has represented clients in a series of large transactions recently, most recently including the acquisition longtime customer InSite Wireless Group, LLC per American Tower Corporation (NYSE: AMT) for approximately $ 3.5 billion.

Steven E. Siesser, Company’s president Private Equity group and co-chairman of its Transactions and Consulting Group, notes that declines in M&A are often followed by sharp increases, as evidenced by the market recovery after the 2008 financial crisis. He notes: “There are still significant amounts of available capital for transactions, mainly with the pent-up demand of the retraction related to COVID in the M&A market. There is a confluence of factors that will continue to drive mergers and acquisitions into resurgence, such as concerns about rising tax rates, the need to replace missed growth opportunities and market disruption ”. Notably, the company’s private equity business activity continues to grow, so much so that Lowenstein Sandler ranked among the main law firms by number of private equity businesses for seven consecutive quarters in The deal.

Bennett reports that “now is the time for companies to prepare for these impending transactions, making sure that their R&W coverage is secure and tailored to their individual specifications and business objectives.”

About Lowenstein Sandler LLP

Lowenstein Sandler is a national law firm with more than 350 lawyers based in New York, Palo Alto, New Jersey, Utah and Washington, DC. The firm represents leaders in virtually every sector of the global economy, with a particular emphasis on investment funds, life sciences and technology. Recognized for its entrepreneurial spirit and high standard of customer service, the company is committed to the interests of its customers, colleagues and communities.

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CONTACT: Stephen J. Kimmerling

Director, Marketing Communications

Lowenstein Sandler LLP

T: +1 973.597.6176




SOURCE: Lowenstein Sandler LLP

Copyright Business Wire 2020.

PUB: 11/11/2020 19:27 / DISC: 11/11/2020 19:28

Copyright Business Wire 2020.

Paula Fonseca