Mergers and acquisitions in Hungary - Professional Hungarian Law Firm

Mergers & Acquisitions in Hungary

As everywhere else, M&A in Hungary requires the support of a reliable legal team. Your
lawyer in Hungary will have to possess not only in-depth knowledge of the statutory
regulation of M&A transactions, but will also have to be familiar with how to best harmonize
the national legal possibilities with your interests and the economic target of the deal.

The term mergers & acquisitions (M&A) refers to the aspect of corporate strategy, corporate
finance and management dealing with the buying, selling and combining of different
companies and their assets that can help a growing company (the acquiring or merging entity)
in a given industry to develop rapidly.

M&A indicates all dimensions and levels of corporate stake or asset related transactions:
national and cross-border mergers and acquisitions, share and asset deals, leveraged buyouts
and equity investments, public and private deals.

Mergers & acquisitions are often used synonymously, although they are different tools. When
one company takes over the majority stake in another one, the purchase is called a corporate
acquisition. As a result of the transaction, from a legal point of view, the target company does
not cease to exist. A corporate acquisition may be friendly or hostile, depending on how the
purchase is communicated to and perceived by the target company's Board of Directors and
shareholders. Merger is carried out when either two or more companies merge together or one
company merges into another company, and one or more of the merging companies cease to
exist. As the merging entities need to cooperate during the transaction, mergers are of a
friendly character. In practice, acquisitions are more frequent tools as opposed to actual
mergers.

There are various types of M&A transactions, as well, that may amongst others be:
- Horizontal mergers - two competing companies that share the same product/service
lines and markets seek to acquire a co-operational structure.
- Vertical mergers - the supplier and the customer of the same product participate in the
deal.
- Conglomeration - two companies that have no common business areas participate in
the deal.

As a business-minded law firm in Budapest, Hungary, KK Legal provides complete M&A
legal support to companies that are considering either buying the majority stakes or assets of
another corporate entity or embarking on a merger.

Since M&A requires a comprehensive transactional approach, attorneys dealing with M&A
transactions need to have excellent knowledge of statutory law, relevant experience in the
national and international M&A transactions, fluent language skills in English, German and
Hungarian, as well as ability to understand the deal in its complexity and efficiently negotiate
with the parties. Besides the above, your Hungarian law firm must have the technical
capability and infrastructure in order to manage the due diligence (DD) as well as the
implementation phase of the transaction with precision and speed.

For further questions and for references, please kindly contact the law firm’s partners, Mr.
Zoltan KATO at zoltan.kato@kk-legal.com or Mr. Gyula KOROSY at gyula.korosy@kk-
legal.com.

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