Business Article: Financial Comfort If a Seller Doesn't Tell the Truth
3/1/2001
An additional tool has become available for M&A practitioners who must manage the frequent mismatch between a buyer's need for adequate protection against a seller's breach of representations and warranties, and a seller's desire to provide limited protection or even no protection to the buyer. It takes the form of a "risk-transfer" insurance policy that compensates the holder for at least part of the post-closing damages suffered because of a breach and can help get deals done by bridging the often-wide gulf between rock-hard positions.
