Audra Cohen, Co-Managing Partner of S&C’s General Practice Group, spoke on the panel “Hot Topics in M&A Practice” at Tulane’s Corporate Law Institute in New Orleans. The panel offered insights into dealmaking in 2022 and trends for 2023, including macro factors affecting M&A. Rita O’Neill, a member of S&C’s M&A Group and Co-Head of the Firm’s Global Private Equity Group, moderated the panel and serves as Co-Chair of the Institute, which brings together legal practitioners, members of the Delaware Supreme Court and Court of Chancery judiciary, leading corporate counsel and Wall Street investment bankers to discuss top-of-mind issues in M&A, corporate and securities law.
The discussion was featured in a Law360 article, “Debt Availability Poses Key Challenge To M&A Activity.” The article explores how geopolitical and economic risks have led to a rise in the cost of debt and the challenges associated with closing large M&A deals in the current climate.
While traditional debt financing from banks is drying up and the cost of debt has increased, Audra pointed to some good news. “There is a lot of dry powder available,” she said. “It may just be that you have to go to these new nontraditional sources that are now becoming main markets.”
In the article, Audra also notes that sovereign wealth funds, pensions and private equity firms are filling in the gaps left by banks. “The cash is available there,” but “you need to start thinking about your financing earlier,” she advised. “You need to build that into your process to see if you can align terms and [figure out] what those terms are going to look like.”
Read “Debt Availability Poses Key Challenge To M&A Activity.”