Benefits of M&A - Private Merger & Acquisitions in Colombia

October 28, 2019

Merger and acquisition is about the "marriage" between two companies, M&A, is the area of corporate finances, management and strategy dealing with purchasing and/or joining with other companies. This process can be fragile, because of the risk, resistance to change, relocation times and other variables that are involved in the process of M&A.

With the help of our professionals in commercial law we can give you the best legal advice if you want to start this kind of process in Colombia, attending all the needs of both companies in this process of M&A. We can help you out in public and private mergers and acquisitions, in the different sectors of the economy and regulated industries.

Which are the Legal Regulations of M&A?

The Legal regulations of mergers and acquisitions are:

• Commercial Code, Law 222 of 1995 and Law Law 1258 of 2008, rules that govern an M&A transaction from a corporate perspective.
• Financial Statute and Decree 2555 of 2010, acquisition of financial institutions.
• Law 964 of 2005 and Decree 2555 of 2010, acquisition of publicly traded companies.
• Law 1340 of 2009 and Resolution No. 88920 of 2017, antitrust merger control regime.

Which Entities Regulate Mergers and Acquisitions of Companies in Colombia?

• Superintendency of Companies, which is the governmental entity that undertakes the surveillance of companies from a corporate and foreign exchange perspective.
• Superintendency of Finance, which is the governmental entity that undertakes the surveillance of financial entities (including banks, insurance companies, insurance brokers and broker / dealers, among others) and authorizes transactions related to publicly traded companies.
• Superintendency of Industry and Commerce, which is the governmental entity that undertakes the surveillance related to antitrust matters.

Our M&A services are:

• Advice on issues of shareholder activism
• Sales Advice
• Intention Agreements or Acquisition Offers
• Post-Merger Non-Competition Agreements
• Confidentiality Agreements on Fusion Lathe
• Supersociety Authorizations (Shareholder Agreements)
• Privatizations and capitalizations
• Joint Ventures
• Excisions and reorganizations
• Shareholder Agreements
• Exit Strategies
• Organization of Competitive Processes

Which are the Benefits from Having a Colombian Mergers and Acquisition?

The benefits of Mergers and Acquisitions are:

• New ways to enter into competitive markets
• Introduce new products
• Complex tax consideration
• Merger teams for major transactions
• Cross-border M&A
• Bring down the cost of operations
• Gain higher competitiveness
• Financial leveraging

In AGT Attorneys we have advised colombian and foreign clients in deal structures, corporate matters and other legal services in M&A.

Which Types of M&A Exist?

Mergers are characterized by the union of two or more companies and the loss of legal personality for at least one. There are three main models fusion:

• Horizontal M&A: two companies that are in direct competition come together. This action increase the market power that both have expanding their range in the services and products that they have.
• Vertical M&A: two business that operate along the same supply chain, merger between them to join forces in the same commercial area.
• Conglomerate M&A: Two companies in different industries join forces or one takes over the other in order to broaden their range of services and products.
• Concentric M&A: In some cases, two companies will share customers but provide different services.

If you want to make the first step in have all the legal advice of private merger and acquisitions in Colombia, we can definitely help you with that, contact us calling us at +57 310 5706331 or by filling out the next Contact Form.

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