DD in M&A Transactions in Norway

We’ve already covered the specifics of M&A transactions in Norway & importance of DD. Today, we’ll be taking a closer look at the key aspects of DD in M&A deals in Norway & its types.

Types of DD

The scope of DD in Norway can vary substantially depending on the type of business target companies are involved in; however, it often includes a comprehensive financial audit & tax DD.

Legal DD usually focuses on:

• corporate governance;
• control change issues;
• risks associated with material contracts;
• real estate issues;
• environmental responsibility;
• licenses;
• labor & pension issues;
• IP rights;
• disputes & legal issues.

Commercial DD often mainly centers around market analysis (e.g. analyzing trends capable of putting Norway-registered companies in jeopardy).

Sellers’ Responsibility

Sellers may be held responsible for distortion of information in the pre-contractual period; however, the parties can eliminate this possibility by including a corresponding clause in their SPA. An exception is made for claims involving gross negligence, deliberate misrepresentation of facts or misconduct.

Publicly Available Information

DD of M&A transactions in Norway involves an analysis of publicly available information about private companies & their assets. This information can be accessed by filing a request with a register of Norwegian companies. 

Potential investors can request:

• incorporation-related documentation;
• information on BoD & general director;
• information on changes in companies’ authorized capital;
• decisions on approving transactions between companies & their shareholders/directors;
• audited accounts & directors/auditors’ reports.

Potential purchasers can also get access to information on:

• real estate (including its cost) & mortgages;
• IP registered in Norway (TMs & patents);
• bonds.

Conclusion