M&A Execution: Strategy from Skadden Expert Arash Attar

If you're on the buy side, you already know most M and A tools aren't built for you, they're built for sellers. And it shows. That's why we built Deal Room. It's the number one platform for buyer led M&A, designed to help you lead the deal from pipeline to diligence to integration without the chaos. You get real time project management, AI powered contract review, templated deal rooms and live collaboration all in one place. No bouncing between tools, no duct tape workarounds, and definitely no hidden fees. If you're serious about executing smarter, check it out@dealroom.net now back to the episode Most M and A teams have a dirty secret. They're one big deal away from a complete meltdown. But this four person M&A team is about to close eight deals this year. Sam Bragg's team at US Heart and Vascular is using buyer led M&A to build a repeatable process that takes control of diligence. No more five separate vendor checklists. No more delays because something slipped through the cracks. We're breaking it down live August 14th at 11am Eastern. Join us for Inside the Deal how US Heart Masculine scaled M and A with Deal Room Fast, clean and controlled. You'll see how they consolidated diligence across vendors, the system that keeps deals on track, and how they cut weeks off of timelines without torturing the team. If you're trying to scale deals without wrecking your bandwidth, be there. Register@dealroom.net InsideTheDeal Again, that's dealroom.net InsideTheDeal Foreign I'm Kisam Patel and you're listening to M and A Science, where we talk with deal professionals and learn valuable lessons from their experience. This podcast focuses on stories, strategies and what actually happened during M and A deals. Hello and welcome to the M and A Science Podcast. This podcast is part of a mission to rethink how M and A is done. That old school seller led approach? It's dead. Buyer led M and A is all about strategy, alignment and efficiency, putting value creation at the center of every deal. And let's be real, it's not just about closing the deal, it's about making it successful. We uncover what truly works in M and A by learning directly from the best. I'm your host Kisan Patel, founder and CEO of Deal Room and Chief scientist at M and A Science. Today I'm joined by Arash Attar Razvani, M and a partner at Scaddin, based in Paris. Arash has spent over two decades advising on some of the Most complex cross border M and A transactions in the world. From telecom to tech to luxury. His deals span multiple jurisdictions, legal systems and cultures. In this conversation, we unpack how to structure international M and A deals, navigate regulatory landmines and build creative legal structures.

When no playbook exists.

This episode is part two of our.

Conversation from last episode.

If you missed part one, I recommend giving that a listen first.

Otherwise let's pick it up right where we left off. When do we want to play that scenario out? Do we want to do that before.

Loi or after loi?

You have to have enough information on the target to be able to assert what it is. So before, after loi depends on the strategy. If it is clear to the seller that it must be done and every buyer they will talk to will insist on that thing being done, there's no reason to not mentioning upfront and wasting everybody's time. Often you might be in a auction process, you might be in a competitive auction, maybe not everybody will have the approach that you have. So it might be wise to wait to have more information about the target and most of situations. Kiesen, to be honest, is very rare that exactly what you're going to be doing the moment you close, as you said, it could play out over the next year, two years and you may change your mind. And I've seen that a lot of times. So in that kind of situation, probably wiser to wait, get into the LOI process knowing that you're willing to engage and maybe go to certain level before you definitely commit the loi to which is a non binding document. So the non binding loi to binding loi stage would be where I think you'd be doing that assessment in terms.

Of working with French. After this meeting, I got to go around the corner to one of your well established private equity firms and talk to them about one of their non performing assets. What's like a good way culturally being mindful here? Because in America we tend to be pretty direct. It's a brash of like, hey, you got this thing, I'm interested in it really forward. Teach me so I can actually get this deal.

So do you speak French?

Bonjour.

You can use that. So that's one of the cultural elements I was talking about because I.

You got a good point. I noticed if you just walk up to somebody who's talking English, boom, they're going to get offended. If you start with just bonjour, Bonsoir and then you start talking English, they'll actually respond to you.

It can Help. It can help. We've seen a lot of different responses. You have people, you speak French to them and they'll still speak English to you. And others, you speak English to them and they'll switch to French. It's gotten much better. It used to be that you'd be in a meeting with 20 people, five of whom would not speak French at all, and then all the French speaking at some point will switch to French. We see that a lot less in France. Yes, you guys are direct because I'm plugged into American society and your stand up, your culture, since we're kids, basically, and I live there, I work in an American law firm, I studied there. So I understand probably the culture a lot more than the average French. Yeah, you guys like to be direct, but also, interestingly enough, you might not be direct at all, communicating what you really want. There could be a lot of, oh, it's such a great idea. And in the end, you're just going through the motions of turning everything into a positive everything. And when I speak to my French clients, after we've had this kind of negotiations with Americans, sometimes they're like, yes, everything's beautiful, everything is wonderful, everything is rosy. But we don't know what they think. And in a way, the French are sometimes criticized for this, for being arrogant and so on. I think I'm just trying to say there's never one color or one aspect to the culture because the French can go around a little bit and it's good to start with some small talk and so on, but it'll be very direct as well. I've seen American counterparts being shocked by how direct the French are, because you guys may be direct, but you like to keep the form of being polite, you know what I mean? Whereas the French will deliver it to you raw sometimes. I've definitely seen both sides of that. Partly I don't see myself as just French because I told you I have a lot of that background. So I look at it as an observer. Sometimes if you speak your mind in an honest way, you don't take them for fools. You just communicate clearly what it is you want and why you want it. And you respect the other side. France is an old nation. They have, or we have probably a higher opinion of ourselves and our culture and history than the current place of France in world affairs might suggest. And I'm not going to say more, the French always revere the times of Louis XIV and Napoleon, and the Americans are acutely aware that's not the case anymore. If you come what we call your Texan boots on the ground. And it's like you guys are all, it's a second class, but you're all clowns. We know how to do things. We'll explain to you how it works. That's not going to work in the French context. You need to put a little bit of decorum and have what in the most sophisticated American counterparts that you meet that have the sensitivity to a different culture. A little bit of that goes a long way.

Okay, start off with some pleasantries. Sounds like just generally being open minded but generally being forward.

Yeah.

In this case, they have an asset that's underwater. Now there's a mix because I'm American, but I'm also Indian. I was raised by immigrant parents. I'm very cheap. I like buying things on pennies on the dollar, basically. So in this instance, and I know for an investment firm, they have an asset underwater and they want to at the least get their money back. But for me, it's like, you've raised X amount. Can I get it for 50 cents on a dollar?

Pleasantries. Argue your position. Respect their culture and their position. Would argue.

So having a business case of like why it should be 50 cents, that's a concern. I was like, I guess my view of the French may stereotype here is they're a little more serious. We do a little playful bantering in the US and joke around a little bit. I'm like, I don't know if that's going to land as well.

It's tricky. Humor is tricky because humor is not accepted or taken the same way.

Exactly. That sounds always univers. There's like different flavors of humor and then some just flat out.

I can tell you what my approach is. I really. And it sounds super corny, but it's true. And as the years go by, it's even more true. I'm just being myself. I like to use humor also to diffuse some situations. Doesn't mean sometimes it's tense and it has to be tense, but most of the times you get a feel for who you have. Of course, if you have a very. I'm gonna take also some cliche, very stuck up French person who's really into themselves and so on. And you start with some dirty humor. That might not be their brand of humor, their strand of hum, but by seeing people and seeing what they react to. I've had a very positive experience just being myself, being approachable, having this light demeanor, but serious on the topics. Always serious on topics. Respect the other position. Listen, listen, Goes a long ways. 90% of the success of any meeting is listening. Listen to them, look at them. See how they interact between each other. If they use humor, okay, that might be something they appreciate from you. If they don't, that might not be the right approach. So you just go through your meeting. But what I've noticed everywhere around the world, I've been from India to Brazil to Africa. If you are sincere, you don't take them for fools and you argue your positions and you have to know where to give. You can't always take if you know difference between what really matters to you, which really you need to get, whether you express it or not. Sometimes you may not want to express it right away, but where to give them things that are important to them and not to you. That's the key to getting a successful negotiation over time. And if not, even if it fails, you'll get their respect. And I'll tell you one thing, I've gotten probably more clients referred to me by other lawyers who are sat opposite or clients I sat opposite than I've had in any other way. That's the best compliment that anyone can pay you. Somebody was telling me the same thing recently, is that when another lawyer refers work to you, it means they see you as somebody not only competent but probably trustworthy. And it's the best compliment they can pay to you.

Okay, I'm going to take your advice. I'm going to go to this meeting and I'm going to start off with listening and really kind of understand their point of view. And with what I learned from listening, I'm going to essentially be mirroring. Right. Their little sense of humor. I'm going to play into that.

Stay true to yourself and then call me and tell me if it was a huge success or a catastrophic failure.

And I'm still going to be myself for sure. I'll still be myself picking up the room from that. I'll build my business case or my sort of position and see where we can land.

Absolutely. That's what I do. And I'll be honest, it's worked well for me.

So hopefully if I get next steps, I'm going to call you because I may need representation out here.

Please do, with pleasure.

Going broadly back to like cross border deal, because I do respect the fact outside of France, you've worked with so many different jurisdictions, what would you define as like high stakes cross border situation? When people say this is a high stakes cross border deal, what does that actually mean?

I'll be a little cynical. I Think people like to hype themselves up. You know, for me, high stakes means there's lives at stake. So let's be clear. If today I was going to negotiate an agreement between Israel, the US and Iran, this would be high stakes.

Okay?

But let's be clear and let's not give ourselves too much importance in what's.

The M and A. We put a dollar figure. It's almost like anything at a billion plus enterprise at the end of the day.

Exactly. But at the end of the day, you know what? When it's just about money, come on, you know, the rest is high stakes, but it's just about money.

Just about money. Yeah, exactly.

When I think it's high stakes, when people's lives are at stake. Where M and A has people's lives at st, I go back to the employees. M and A can be done. And then people losing their jobs, losing their livelihood. And that's why I think even though I'm hardcore pro M and A pro business, pro capitalist, everything you want, little dose of remembering there's people behind some of those things and they may suffer. Is that so crazy that we have to ask them their opinion? Which by the way, we don't really care at the end of the day what it is because it's going to affect them. They're not just numbers. That goes back to what I was telling you earlier, Kiesen, which is when you have entrepreneurs with a strategic vision and industrial vision, they're building. One of my clients is the Axion Group. There's this French Indian family called the Hiriji family, based out of Madagascar. They're originally from India, but established in Madagascar for five generations. And they all have since then, the French nationality. And I met their four partners, the two uncles and the two sons of the third uncle, who unfortunately passed away. My contact has been one of the sons, Asanani Regi, who's African CEO of. He's a very successful person, one of the nicest human beings, one of the smartest people you'll ever meet. And with Hassan 9 and his group over 10, 12 years, we did all their M and A. We went through Togo, Senegal, Tanzania, Uganda, French islands of La Reunion, Mayotte. And he's built the sixth largest telecom group in Africa, Axion Telecom. We went through all of this hand in hand, building on a vision that he had there. Yeah, there are high stakes because you are negotiating, you know, giving access telecom these days you cannot do anything without a smartphone. And in Africa, where there is poverty and all of what you want but they are more advanced than we are by the way, in terms of money, banking and these sort of services that go through the phone. It's crucial because it brings not only development, it brings financial inclusion. Because once you have a phone, once you have electricity first and actually with the group, they have also an energy group and we've helped them bring energy, renewable and so on in a lot of regions in Africa. But once you have a phone, you have access to a bank account, you have access to being able to raise money or use money to build a small company and then maybe a larger one. It's a whole inclusion, socially, financially and otherwise. That's high stakes to me. What defines high stakes is when there's lives at stake. Everything else which is building on helping a company become bigger and selling more products, it's great. Love it. Basically it's what I do. But I would not call that high stakes.

It's about the people. Some people may have a perspective that's about the money when you look at that situation. But when you're doing those transactions, what are you anchoring on? Is it sort of those specific things where it's impact that this deal is going to have?

So I anchor on all these various aspects. There's a technicity to what we do that has to anchor you on because it's fun to do. I love what I do and it's super creative and intellectually extremely challenging. So that's a source of motivation for me to create something. When you do this job, you have to be creative, you have to want to find solutions. When my kids ask me and it's too difficult to explain to them what I do, I just say basically I find solutions to my clients problems. That's what we do. So that anchors me the as I said before, the psychological, emotional people aspect of it, the human adventures that you live through, those transactions, also a great source of motivation. And then you want your firm, your team to be as efficient and performing as possible so clients are happy and come back because it's a business at the end of the day that we are building. If I've done a transaction where I have a happy client, we found the way for them to do it that no one else had found or thought of. And we made it possible because of our innovation and creativity. It doesn't get any better.

Tell me more, give me examples. I know you've worked on some sort of first of a kind type of deal structure. Some things that are unique. Give me examples of that.

I'll mention one Last year we did this take private of l', Occitane, the national skincare. L' Occitane is incorporated in Luxembourg, has its roots in France, of course, headquartered in Switzerland, and was listed in Hong Kong. So we had to find a transaction whereby the majority owner of L', Occitane, who owns 72% of the stock, was going to take it private, buy the remaining minority shareholders listed in Hong Kong and make it back into a privately held company. The problem is that when you have a company that's incorporated in one country and listed in another, there is no legal path to do a tech private, because the laws of, in this particular case, Luxembourg and Hong Kong, but it is true for France and the U.S. it's true for others we've done, are not compatible. They don't allow you to do it in the traditional way that each jurisdiction would do it. So let me take an example. In Luxembourg, you would have to do it through a merger. There is no legal regime to merge a Luxembourg entity with a listing in Hong Kong without having to go through some form of complex procedure. So what you would do is a tender offer, except that the tender offer would be subject to the securities laws, that is the Hong Kong Stock Exchange, and in Hong Kong, they would tend to do it by way of other transaction structures, scheme of arrangement and so on, which Luxembourg does not recognize. We had to find a very original way, I think it's the first worldwide, of doing a take private. So we did a tender offer subject to govern under Hong Kong laws. But for the final squeeze out of the minority shareholders, we used the bylaws of the company. We did not use a lower regulation. We used the bylaws of the company, which had the provision that we could build on. We had to comply with two sets of laws and regulations that were not necessarily compatible, creating basically a race to the most stringent. Because if Luxembourg said to be able to squeeze out the minority, which means force them to sell once the tender offer is closed. In Luxembourg, the threshold is 95% of the share capital voting rights of the company. If you reach in the tender offer more than 95%, then you can force the 5% minority to sell to you. But in Hong Kong, it's 90% of the minority that remains. So in effect, it was a threshold of 97.2 or 3%. So we had to take the most stringent of the two. So we had to be such a successful offer that at the end there was less than 2.5% outstanding that we could force to sell. And we had to convince both sets of authorities that this is something that could work, that did apply, protect the rights of minority shareholders in both jurisdictions. And that was not subject to litigation. And I can tell you it was a huge effort. A dozen of the largest law firms were involved. For one party or another, we were coordinating the deal. It was an effort between our Paris and London and Hong Kong offices. We had 40 scouting lawyers probably working on it and over 100 lawyers. And to the risk of sounding immodest, very few firms would have been able to coordinate something like this.

That sounds expensive. Take. Privates aren't cheap, are they?

They're not. Definitely they're not. And clients will always complain that they pay their lawyers too much. That's what I'm saying is the value of finding a way to do something that's impossible. What's the value to you?

That's true.

When bankers do it and they charge percentages of transaction value, they could get paid dozens of millions of dollars.

It's worth it is that view?

It is. When law firms do it, we bill by the hour. So definitely it's going to be legal fees usually, except for maybe one firm worldwide, probably that we all know or we suspect has a different billing model. When you look at it, the legal fees, the larger the transaction, of course, there's between 0.5 and maybe 1% of the transaction.

I'm curious, you brought up watchtail because that's what they're infamously known for is having success fees almost matching the bankers fees in some cases. How do you see like AI, Right.

Obviously AI is like merging.

We built a product last year that does contract extraction and we have a lot of in house counsels using it. We don't currently sell to the external firms. Maybe they'll change in the coming years.

Okay, and what I was curious about.

Because you see these in house counsel using it to reduce some of the reliance. Especially when it's like pretty tactical contract review that they're doing. They're just looking to extract key clauses. How do you see that affecting one? Just how you start perceiving utilizing AI but like how your business model may change. Because my theory is that firms will start going more towards a mix between a flat rate and success fee model just to stay aligned. So that way there is clear incentives of yeah, let's leverage AI, let's get the best results. And then maybe not matching the banker's fees. Maybe the banker's fee should be split between everybody else, consultants and lawyers.

I don't think bankers would like to share their fees.

We don't have to give them a choice, do we?

That's true. No, I agree with you, definitely. The way we work is impacted by AI and the way we are compensated will ultimately have to change as well. To be honest, I've always believed, and in some cases I've been able to do, that it's okay to have part of our fees paid in the form of a success fee. Obviously, it's easier to do in litigation or in some cases where the actual you can calculate the actual value of what you do. When you do M and A, it's hard to put a number to what it is you're doing. You can take another example. You said what you need to be working, cross border, et cetera. It reminds me of this Star wars quote. Master Yoda says, you must unlearn what you have learned. And what I mean by that is you have to to keep an open mind, to not come with all of your reflexes and prejudices in a different jurisdiction. When you do that, you might find a path that no one had seen. Tying to the conversation first and then tying it back into AI and the compensation. So when you find a transaction structure that doesn't exist, how do you put a value on this? When you win a litigation win or lose, in most cases, you can calculate how much a client has won or lost because that's an amount then the judge will allocate to the other party. So if you win and you win 150 million, let's say it's easy to see, okay, what was the value of what you did you want 150 million for your client, or 10 million, whatever. Or when you have tax advice, you've saved that much money, et cetera. When you do M and A, it's much more subjective. The successful discussion has to go back again to trust and good faith that the client will see the value of what you're bringing. You have an open discussion for that. What AI does currently, it saves time, contract review is speedier, have a bigger scale, risk flagging and so on. I don't think necessarily it's a bad thing because it does save us time. It allows us to focus on the higher value aspects of what we do. Because I don't think, at least not in the current state, maybe in five, ten years, who knows? But we are in these complex human interactions and negotiations, maybe even the contracts, when we tell them, let's do this, and that the AI will produce the contract that goes with it. But I think in the type of job that we do, and that's what ultimately might differentiate, maybe a lot of law firms will disappear because everything that's basic to do, that's a low value can be done by the machine. It's only when you bring that thing that machine cannot do that very bespoke, tailor made advice that you can charge top money for it. So that raises two questions. One is a question of training. What do we do with our junior associates? That's a real question because a lot of what they do is research. I was reading an article in New York today or yesterday that actually tackles that issue, that the time of writing essays in university is gone. They're not writing essays anymore. Everything comes from a machine. If you translate that into what we do, we have to teach them to do other things. What are they going to do the first 5 years that they're on? When NDAs will be drafted automatically, research will be done, due diligence, all this work will be done. So it challenges law firm to think what is we do? And then ultimately you're right, it is going to have an impact on the level of compensation we can ask for. Because Instead of spending 20 hours doing something, if the machine spends 20 minutes, of course you're not going to build that the same way to the client. So I think over time we're not there yet. It's going to come quicker than we might think. Of course, as everything AI related these days since 2022, at least the emergence of ChatGPT, facing some hard questions on the training front, on fundamentally what it is we do, what do we bring? Because a lot of lawyers are reduced to either pleading in court or scribbling paper. The scribbling paper model is probably going to be gone at some point and maybe it's for our generation, maybe the next one. But that's why I have the weakness of thinking that so far I don't think a machine can replace what I'm doing. Me and a lot of my peers. And that's what we need to focus on. We need to ask ourselves what's the value that. I'm obsessed with that question. On every deal, every client, what value do I bring that client, especially when we build them? Because you see an amount which is reflective of the work you've done and you have this conversation. And I'll be honest, yes, the conversations are not always easy. But as long as we've been able to demonstrate or they've seen the value that we bring, I've never had a major problem to recover those fees. But those discussions will become the norm.

Well, I have to compare notes because even from a software person like me, it's the same question. It's like, how do we look at our pricing model and align better with the value you deliver? The success fee is interesting because I feel like it's easy to pay people out of your fund to flows. Sure, everyone gets a piece like your Oprah. You get a hit, you get a prize, you get a prize. Nobody wants to pay upfront.

That's true. And we don't actually paid up front. But I mean, there's also an industry practice, for example, a lot of people forget. But 30 years ago, billing by the hour was not the model. Lawyers will be paid a flat fee or some form of success fee. Today, for example, in France, by our constitution, our ethical code, we cannot charge the majority of our fees as a success fee. We cannot have such a risk component. It's forbidden. Actually, you can have a small portion of it. So in an industry where billing by the hour has become the norm. Yeah. It might take something as earth shattering as AI to reverse the model over time. Because I've always thought billing by the hour, it's like they say, democracy is the least good regime. Bar all the others, it's the same. Billing by the hour, it's catastrophic because it's not conducive to creating the best relationship with your client. Especially. So I always tell my clients, listen, relax, we'll have the discussion, etc. Don't. Some clients are obsessed. They were going to speed through an explanation so that it's less than 30 minutes. You have that type of.

Yeah, you sit there like, come on.

They brief you half of what you need to know. And it's not conducive to relationships. I never thought it was. But unfortunately, time spent is still the best measure of value. And I think there's something inherently limiting with that and we should evolve to something maybe hybrid.

Looking at trends, deal structure, you give an example of something super complicated. But I'm just wondering, in general, we've seen a couple dual track processes happen in the market. I don't know if that's something that you see as something that's going to continue or just even broadly of just structures that you think are going to actually trend forward in the coming five years.

Dual processes. We still see them, they create.

I have a friend that I don't know if they did a duel. I have to ask them. I was surprised because I thought they're going to go do their next round of funding to go raise because it's a growth company, but they end up getting acquired and for them they just got an offer they couldn't refuse.

I think it's very context dependent. If you talk about the world of PE and so on, when debt was basically cheap and basically free, the capital markets are doing very well. It gives you a lot of alternatives for an exit. When the debt became super expensive and or capital markets starting to underperform and were not seen as an efficient exit, then you saw that M and A took the. Instead of fundraising, you got to that stage of previously maybe a year or two priorities, you would be going to series C and D and so on. Suddenly you're selling the company or going to an ipo, you're selling the company. We saw a lot of that happening in the tech space in Europe and probably also in the us. Dual track. It works if there's a real alternative, real and credible in two ways. Point one is there's a real capital market or a real M and A market. Doing an ipo, for example, is not a viable avenue. It's a fake process. Everybody will know it and they'll just think you're maneuvering to push them into, you know, higher value. So there has to be good conditions on both market and two, you have to be really committed to it. That's how you create a real alternative. If you're not fully committed to it, it's not credible, it's not going to work. I don't know if currently I'm speaking for Europe, we're in the kind of space where, and definitely in France where market conditions are such that you can really credibly say someone, a potential buyer, listen, even either you buy at that price, but I'm confident I can sell at that price. In the securities market, I'm not sure. But when you have those conditions are present, of course you're creating tension. At the end of the day it's about competition and tension. How much somebody else is willing to pay for that same asset.

That's interesting. So that would be the circumstance. You do a dual track process. Otherwise you may prioritize one and use the other as a backup plan.

Basically, the ones that I've done always was the same sort of model, which is we're preparing for an ipo, however, because we think we're going to get a price of X. However, if you make me a good offer, I'll consider your offer over an IPO process. But you know what? In the meantime, I'm still continuing my process. And by the way, in the documents you'll see in the DARE room and so on, somehow you'll see that some of them really relate to something that looks like an IPO and you keep the tension away.

Any other deal structures that you sort of see emerging or trending, We've seen a lot of earnouts all over the place now.

Yeah, but earnouts, it comes and goes. It's like, yeah, earnouts, of course it's a way to defer the probability of.

That capital going up. Now all of a sudden it's pronounced back in flavor.

Exactly. Because when it was a seller's and they knew they had 10 buyers, six of which were these PE funds that were borrowing for free basically and overpaying assets, which it's not a secret that they have been overpaying assets. And a lot of my strategic clients were quite, I don't say happy, but they were not displeased saying when a few years ago the debt market became as expensive as they did because they told all their friends in the PE funds you forced everybody to overpay. And now that you have to pay for the debt, you're basically excluded yourselves out of these processes. And we saw, you know, I work with PE funds like Silver Lake for example, I advise a lot of strategic buyers and suddenly we were in these processes where pure strategic players, that's all you had because they piece for a time and then he's very resilient, very creative. They found ways to structure and find the money to do it. So earnout is one way to pay a cheaper front end price and have a contingency on the payment of a further deferred price. The problem with earnout is there's a statistic somewhere. I don't know if it's definitely more than half of them lead to some form of expertise or dispute or litigation. Because of course when you are willing to do a deal, you're willing to agree to the conditions of earnouts. They're extremely complex. They're sort of a deal within a deal. When you negotiate an earn out and then two years down the line when suddenly you have to appreciate assess whether the earn out is payable or not, guess what? Parties don't agree that it's payable or not in full. And you get into all these disputes and it could be litigation or renegotiations of the deal and in the end settling. So yeah, earn out carve out the last 10 years. I'd say one of the most surprising trends that came and went just as fast as it went. Were the SPACs definitely, yeah.

Talking about come and go.

And spacs have existed since the 90s. I've talked to some of my partners in Palo Alto. They've been doing it for 30 years and they suddenly there's this high trend of doing them. They four or five years of them. I still have actually I have a client who's raising one and we're looking at his SPAC to help him. But of course they're much smaller, they're more reasoned, they have to justify a lot more. But. So that's one of the trends we saw. And now what's going to come probably more is sort of club deals between maybe between pes to mutualize funds and be able to buy some of these assets. Yeah, these kind of structures.

We see Lydia, they introduced us aspiring to be a partner and just thinking of a lot of lawyers that are in that role, whether mid level junior. What advice do you have for them being partner at like literally a top three global M& a law firm.

So that's super interesting because I also teach a lot of students from law schools, business schools, and it's important to stay in touch with the younger people. And we have interns here. And so it depends. When I have students or interns that ask me that question, I tell them, listen, I don't think you should obsess when you're 22 or 23 and just starting your legal career. Don't obsess. How to become a partner at this firm Obsess around. How do I get the best training for the first five years in the best place with people who are truly invested in my professional growth and my training. First of all, it's great that you have the ambition to be upon it. In French we have this expression, don't put the car, you know, don't put.

The carriage before the horse.

The carriage before the horse. Exactly. Let's do the things in right order. Focus on how you can be the most useful to your mid level senior attorneys, the partners. As I said, it's this clockwork. Especially Eminem. You're a part of a team. Because you're an intern doesn't mean you count. Because if what you ask you to do is not done well, it might grip the whole machine and focus on how can I be the best at what I do at that age? And maybe year one or two, you're obsessed about being a partner. And then when you're a 6, 7, 8 year associate, that's no longer what you want to do you want to maybe have a different career or change path or something else. So focus on the first five years and then focus on the next five years and then focus on the next five years and that way you could keep it fresh and fun. And you don't take short term decisions, make long term decisions. Something that may look like, oh, yeah, I'm a fifth year associate, whether I stay or I go because I have more chances of being a partner at that place. Your chance of being a partner at a fifth year usually is the same anywhere, which is nobody knows. Focus on, do I have the right people around me?

You're around the right people.

Yeah. Around people who train me, teach me the trade, the right skills, and then there'll be ample time to worry about partnership and becoming the king of the world.

How about yourself? What would advice you'd give to yourself before running your first major deal? Younger self.

If I had to advise my younger self.

Yeah. Before your first major deal, what would you do different?

Interestingly enough, I never really think in those terms, but if I look at how I was back then, in some ways I say the same thing. I tell myself to be honest every day and I tell every people and I try and practice it is just tell the truth all the time to yourself, your clients, your colleagues. Because even though short term, some people might think it hurts you long term, you always win. I would look at my 22 year old when I came here at Skadden and say, listen, just do what you do. And in the end it didn't work out so badly.

Be genuine.

Yeah, yeah. Don't stress too much. Maybe that's the other thing is don't stress too much. Things work out. Be calm, be cool, be the composed one in the room as opposed to being the loudest in the room. And even though you'll have frustrations in terms of promotion, satisfaction of your work, the way it's perceived in the end of the day, at the end of the day, it's been my observation and is that you stay true to yourself, you state your goals, you say things that you want. If you're lucky, it works out in kissing. I'm going to tell you one thing. When you invest 15, 20 years of your life into something and it works out, there's very little professional satisfaction that raises to that level. And I really, truly wish that everybody can feel that because when it does work out, it's really bliss. It's not easy every day, but it's really great.

It's like building equity over long term, like, you really feel the ownership?

Yeah. You feel that there was a sense of purpose. Actually, I have my faith that helps me in that sense. It gives a sense of purpose to your life. It wasn't all for nothing.

I gotta ask you, what's the craziest thing you've seen in M and a.

Craziest thing I've seen? Can I frame it in terms of disappointing and inspiring?

Sure.

I'd say the most disappointing thing I've seen is how, and I'm being very open with you, is how government interference and sometimes greed and corruption interferes with what we try to do. That's been the biggest disappointment because there's a lot of not everything is logical, not everything is rational, not everything is fair. And the disappointment has come from that working in high stakes M and A where governments were involved and were not deciding in the best interests of their citizens, but in some cases really of the governing class. So that's been very disappointing. And I'd say relatively the most inspiring has been to see my clients react in those situations in terms of the integrity, the honesty of not yielding to an easy path, but a wrong path. I've been really inspired by some of my clients that in spite of, yeah, they could have cut corners, et cetera, they remained true to themselves. They clearly set what the rules were and with integrity and with honesty found a way out.

You got the good and the bad and just one kind of feeds into the other. You overcome those situations, but it goes back to your other point, just staying true to yourself.

Yeah. If you have to summarize. In life, it's about balance. Work is about balance. If you find that right balance, ultimately things will go right.

This has been great. I really appreciate taking the time from doing deals.

Thank you.

I did have this conversation and help me become a better M and A scientist.

Please go to your meeting, come back and maybe there's something we can do together and find some solutions.

Those of you still listening, Fellow M and A scientist, thank you for sticking all the way through.

If you made this far, you are.

A true M and A scientist.

I love to hear from you.

Reach out to me on LinkedIn. Connect with me. I like getting feedback, the good and bad. What do you like about this? You got topic ideas. I haven't touched on criticism. I get it sometimes. I'll take it. That's how I get better at doing this. Till next time, here's to the deal.

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