O’Melveny’s Zabinski Quoted in Capital Insights on Emerging Market Buyers

January 31, 2013 O’Melveny & Myers LLP partner Eric Zabinski is quoted in the article “Trading Places,” part of the Q1 2013 issue of Ernst & Young’s Capital Insights. The article focuses on the trend of emerging market buyers, particularly those from Asia, seeking to acquire companies in developed markets. A member of O’Melveny’s Mergers and Acquisitions Practice, Zabinski resides in the Firm’s Beijing and Century City offices.

In the article, Zabinski noted that emerging market buyers are now actively seeking acquisitions as opposed to partnerships. “We are seeing more straight acquisitions by Asian buyers,” he told the publication. “This reflects a new level of confidence among emerging market companies.” Furthermore, he said, buyers across a variety of sectors are increasingly viewing M&A as a path to accelerated growth. “We’re seeing emerging market companies targeting natural resources, clean energy, industrials and consumer and entertainment brands,” he explained. “Many are looking for technology and machinery that can help them build the right infrastructure for growth.”

Zabinski also offered specific recommendations for sellers: understand the acquirer’s needs, and focus on public relations. “Try and put the buyer’s hat on,” he suggested. “What will they be concerned about — labor or regulatory issues, government relations? Prepare yourself to explain these so that the deal still works for the buyer.” Attention to public relations, he explained, helps ensure the deal is understood. “Cross-border deals tend to be subject to heightened levels of scrutiny by the wider world,” Zabinski said. “Price is usually the most important consideration in these deals,” he added. “But that’s only important if the deal has a realistic chance of being completed. Sellers need to factor in the risk of political issues getting in the way of a process.”