Representations and Warranties Insurance for Distressed M&A Transactions: Adapting to a Changing Landscape

Summary

The use of representations and warranties insurance (R&W Insurance) for M&A transactions has dramatically risen over the last several years and is now a familiar staple in many such deals. This of course has occurred only in the context of a period of continuous economic growth and a correspondingly strong M&A cycle. Due to the upheaval in the markets caused by the coronavirus (COVID-19) pandemic in 2020 and the subsequent slowdown and uncertainty in transactional pace, many M&A and bankruptcy professionals are perhaps for the first time shifting their focus to applying R&W Insurance in the realm of distressed transactions both within and outside of the bankruptcy process.