Market Standards: Merger Consideration in Q1 2023

Cash was not king when it came to merger consideration in the first quarter of 2023. Reflective perhaps of broader economic uncertainty regarding the post-closing success of acquisitions over the near-term, an expectation of market corrections, or a combination of multiple factors, the use of stock consideration was more prevalent in merger transactions in the first quarter of 2023 than cash, contingent value rights (CVRs), and other types of consideration combined.

In a survey of 114 merger transactions announced in public company filings between January 1 and March 31, 2023 (excluding four transactions for which consideration information was unavailable):

• 76 (67%) were paid for either wholly or partially in acquiror stock
• 46 (40%) were paid for either wholly or partially in cash
• 6 (5%) included consideration paid partially in CVRs ‑and‑
• 3 (3%) included another form of consideration other than cash, stock, or CVRs

Market Standards is a powerful tool for researching and comparing over 38,000 M&A transactions from 2008 to the present. Leverage Market Standards to find on-point precedent language on the most highly negotiated transactions with over 150+ M&A deal points. To learn more about how it can help M&A attorneys work more efficiently, click here.

Discover Emerging Trends in M&A Transactions 

Related Content

• Consideration in an M&A Deal
  Expand your horizons beyond cash and stock with this practice note exploring the different kinds of consideration used in M&A transactions.

• Contingent Value Rights
  Learn about the key advantages and risks of CVRs.

• Purchase Price Provisions in Acquisition Agreements
  Learn how to navigate the issues you may face when drafting and negotiating purchase price provisions.

• Stock Consideration Clause (Long Form)
  Check out this stock consideration clause template for the next time your client is ready to leave cash out in the cold.

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