2020 Insights: Corporate

Skadden's 2020 Insights

Stay Calm and Carry On: Strong 2019 US M&A Market Supports Optimism for 2020, Though Headwinds Persist
Despite substantial political and economic turmoil, the U.S. M&A market remained strong in 2019. The fundamentals support optimism for 2020, though headwinds could dampen activity.

Optimism for UK M&A and IPOs as New Decade Begins
As a new decade begins and the political situation in the U.K. begins to settle, market participants have several reasons for optimism regarding the outlook for M&A.

Private, Pre-IPO Investments Continue To Gain Influence for Companies Looking To Go Public
The ultimate goal for a new company and its founders has long been an initial public offering. In recent years, however, late-stage private financing in advance of, or in conjunction with, a traditional IPO has become an increasingly attractive option, for both issuers and investors.

Strong Finish to 2019 Offers Promising 2020 for US and European High-Yield Markets
The U.S. and European high-yield markets ended 2019 on a high note, and an influx in M&A supply and strong fundamentals have generated optimism for 2020.

Hong Kong Stock Exchange Poised To List New Economy Companies Trading Abroad
The successful completion of the first deal under a new secondary-listing regime may spark a new wave of secondary listings in Hong Kong of Chinese new economy companies. For well-known technology giants, the potential to penetrate the mainland Chinese markets via the Shanghai and Shenzhen Stock Connect programs will be a powerful incentive to pursue a secondary listing in Hong Kong.

US Corporate Governance: From the Frying Pan Into the Fire?
Three accelerating trends continue to have outsize influence on corporate governance: the dismantling of structural provisions perceived to insulate directors from accountability; a more thorough inquiry by shareholders into board composition; and the growing focus on environmental, social and governance (ESG) matters.

As Shareholder Activism Grows in Japan, New Amendment Places Limits on Foreign Investors
A recent amendment to the Foreign Exchange and Foreign Trade Act, which regulates foreign investments in Japanese businesses, is likely to have a substantial impact on activist investors and certain institutional investors, in particular Chinese state-backed institutions.

A Look at 2019 Court Decisions That May Shape Restructuring Issues in the Year Ahead
A series of decisions over the past year — on issues such as make-whole premiums, intercreditor agreements, backstops for rights offerings and nonconsensual third-party releases — will likely have a significant impact in 2020 on parties involved in bankruptcy proceedings. 

Restructuring Market Trends
Corporate Chapter 11 filings in the United States remained relatively low in 2019 compared to the peak reached in 2009. Most of the year's high-profile filings involved companies from the energy, retail and health care industries. There could be an uptick in restructuring activity if trends in record-high corporate debt levels continue amid a slowdown in the economy.

New Trends Emerge for ‘Consensual’ Third-Party Releases in the Southern District of New York and District of Delaware
A recent survey of decisions from the Southern District of New York and the District of Delaware bankruptcy courts reveals a wide range of views regarding the nature and extent of “consensual” third-party releases that may be appropriately approved. The evolving views and lack of uniformity have resulted in uncertainty for parties regarding this key issue.

Valuation Challenges for Fintechs Highlight Legal Considerations in ‘Down Rounds’
The potential for declining values of fintech companies raises the specter of "down rounds," in which money is raised at valuations lower than prior financing rounds, thereby diluting the value of the earlier shares. Such financings raise legal issues for both investors, new and existing, and the companies themselves.

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