Recently, Nixon Peabody posted its “2012 MAC Survey.” Here is an excerpt:
Between our inaugural survey published in 2002, following the tragic events of September 11, 2001, and our 2003 results, we witnessed a trend toward probidder MAC clauses accompanied, however, with an expansion in the specific exclusions that are focused on acts of war and terrorism and on broad-based market volatility. As time passed and the business environment improved during the 2004-2007 period, our surveys reported increasingly pro-target formulations with a far more robust list of exclusions. That pro-target trend ceased between our 2008 and 2009 results when our surveys showed an increase in the negotiating strength of bidders with a declining list of exclusions to MAC provisions. The results for 2010 and 2011 showed slight increases in the use of exclusions over 2008-2009,
signaling increased negotiating strength of targets over the prior period.
Results from our current survey show the average number of exceptions per deal remained about the same year-over-year, but with both marked increases and decreases in specific elements and exclusions as further discussed herein, signaling continued robust negotiation
to the overall formulation of MAC provisions without a clear year-over-year shift in overall negotiating strength between bidders and targets. Given the overall decline in M&A deal activity during the fourth quarter of 2011 and in 2012 to date, we expected to see a greater degree of change in MAC clauses toward formulations favoring bidders. However, this year’s mixed bag may simply reflect a general shift in attention to certain risks over others rather than an overall shift in bargaining power.