Nixon Peabody recently posted its 2016 MAC Survey. Here’s an excerpt:
This year’s survey found that although the economy has shown many signs of marked improvement since the 2007-2008 financial crisis, the continued widespread inclusion of elaborate MAC clauses indicates the clauses have now become a permanent fixture in M&A deals.
For 15 years, Nixon Peabody has tracked the evolution of Material Adverse Change clauses in acquisition agreements. This year’s survey suggests the uncertainty surrounding the swearing in of the first new president since the financial crisis is weighing on the minds of bidders, targets, and their counsel. The increase in the exception for MAC changes arising from larger political conditions seems likely attributable to questions surrounding the effects of Brexit and the U.S. election.
The MAC Survey is particularly timely this year – as this Deal Professor column notes, Abbott Laboratories & Alere are currently battling in Chancery Court over a MAC clause.
– John Jenkins