Being jilted at the altar is something any company entering a merger or acquisition (M&A) must prepare for. An abandoned union will be expensive and is often humiliating. But for companies that enter M&A talks with a rival in the same sector, it can be catastrophic. What if the rival absconds with valuable trade secrets? It’s a outcome every company needs to consider.
“The best way to protect sensitive or confidential information is not to disclose it in the first place,” says Dr Sean Jauss, partner at law firm Mewburn Ellis. “However, where that is unavoidable, strategies need to be adopted to protect the confidentiality of the information and guard against the misappropriation or misuse of the information, especially if the deal fails.”
He says the process starts with a defensive mindset: “Common sense is invaluable. Parties should only disclose information that they have to disclose and only to those who absolutely have to see the information for the purposes of the transaction. Where possible, the use of publicly available information or non-disclosing summaries is preferable.”
