Bracewell’s Darren Spalding offers a Q&A guide to mergers and acquisitions in the oil and gas sector as part of Practical Law’s recent energy sector content launch.
The Q&A gives a high-level overview of the factors affecting asset and share acquisitions in the sector and the key considerations for buyers and sellers. It covers risks and motivations for the parties; acquisition and consideration structures; the due diligence process; third-party consents; and liability and indemnity clauses in sale and purchase agreements.
For deal-doing in the upstream segment of the industry, Darren identifies a number of the key negotiation points, including the importance of a “clean break” for a seller, the prevalence of material adverse effect provisions and the importance of tax losses and capital allowances. For midstream and downstream transactions, the Q&A sets out the manner in which environmental liabilities may be allocated and the distinction from the treatment of environmental matters in upstream deals.