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Clifford Chance

Clifford Chance

Continental Europe Private M&A Market Practice

A unique analysis of Europe trends in transaction terms during 2021

Our European Market Practice Survey comprised transactions with financial sponsors, as well as corporates, and included both auction sales and proprietary deals

All transactions were led out of Europe and involved a range of cross-border European targets across a variety of sectors. Our survey analysis is based on a sample of 152 transactions led out of Belgium, Czech Republic, France, Germany, Italy, Luxembourg, The Netherlands, Poland, Romania, Spain, Turkey and UK and presents a comparison between the Continental Europe and UK markets.

The results show an increase in the use of locked box and a reduction of the use of completion accounts. W&I insurance was on the agenda in most of transactions, increasing its popularity particularly within financial investors that use this instrument in 56% and 46% of UK and CE deals, respectively. In 2021, regulators toughened up foreign investment restrictions, as a consequence of which we have noted an increase in the use of hell or high-water provisions. Overall, the market remains generally seller friendly.

Digital infrastructure deals have significantly increased in the past year, particularly within financial investors as these assets have strong infrastructure-like characteristics.

Continental Europe themes

Other key themes discussed in the report include:


Samir Azzouzi and Jorge Martín comment on the European market

"The results of the survey show that despite the challenges of the Covid-19 pandemic the market remains largely seller-friendly. In this sense, locked box remains the most popular form of price mechanism, particularly between financial investors sellers, and W&I insurance remains a very popular instrument. An important finding of the survey is that regulatory scrutiny of M&A deals (such as, merger control and FDI clearances) is becoming more common and complex and we note an important focus on allocating such regulatory risk."

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