Buy-Side Fairness Opinion

Summary

This template Buy-Side Fairness Opinion would be provided by an investment bank to the board of directors of a public company contemplating an acquisition. In the opinion, an investment bank formally states its conclusion that the consideration in an M&A transaction is fair, from a financial point of view, to the buyer. This template contains practical guidance and drafting notes. The opinion also sets forth the assumptions the investment bank made in reviewing the acquisition, disclaimers about the scope of its review, and disclosures of the investment bank's relationship with the buyer, the target, and their respective affiliates. For additional information regarding the purposes and content of fairness opinions, related financial analyses, and disclosure considerations, see Fairness Opinions in Mergers and Acquisitions. This template fairness opinion assumes that the transaction to which it relates is a reverse triangular merger in which the consideration payable to target shareholders consists of a combination of a fixed cash amount and a fixed number of buyer shares. Because it is a reverse triangular merger, the buyer's stockholders do not need to approve the merger; however, buyer stockholder approval may be required for certain related actions, such as the issuance of buyer stock to be used as consideration in the merger. This template assumes that the opinion provider is a member of the Financial Industry Regulatory Authority and, as such, is subject to the disclosure obligations of FINRA Rule 5150. This template further assumes that the opinion will be filed with the Securities and Exchange Commission and provided to the buyer's shareholders as an exhibit to the proxy statement soliciting their votes in favor of the actions to be approved in connection with the merger. As with all template documents, this template should be modified as appropriate to reflect the specific facts and circumstances presented. For related content, see Fairness Opinions in Mergers and Acquisitions, Financial Advisors in M&A Transactions, Financial Advisory Engagement Letters, and Sell-Side Fairness Opinion.