Monday, January 31, 2011

Davidoff, Gods at War

Gods at War: Shotgun Takeovers, Government by Deal, and the Private Equity Implosion by Steven M. Davidoff (Wiley, 2009; just released in paperback) is a must-read for anyone who wants to learn about M&A. Davidoff, as some of you undoubtedly know, writes as “The Deal Professor” for The New York Times’s DealBook.

Focusing on the years 2007-08, the author explains the ins and outs (the legal intricacies in particular) of deal-making in its many guises. He introduces the major players: private equity funds, sovereign wealth funds, activist hedge funds, and corporations. He describes key concepts such as material adverse change clauses, poison pills, and lockups. And he looks ahead to deal-making post-crisis.

M&A is an extraordinarily complex, constantly evolving field. If you ever wondered why the lawyers who shepherd deals through to successful conclusions get paid such big bucks, just read this book. The law is complicated and of course varies from state to state, barriers to success are high, and sometimes CEOs can’t get out of their own way. Think of the failed Microsoft-Yahoo deal.

Davidoff’s book, though it reads well, is dense and its parts are interconnected. As a result, I found it impossible to pluck out a couple of quick points for purposes of this post. Ah, I thought, I’d write about X, but then that would require explaining the Revlon decision. Yet even as I failed to come up with something substantive for this post I had to admire Davidoff for explaining the complexities so clearly.

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