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Legal Due Diligence Major Red-Flags for IPP Energy Projects M&A in Vietnam

VILAF Counsel, Vaibhav Saxena share key points witnessed in recent traditional and renewable energy M&A transactions in Vietnam in Vietnam Investment Review

Power sector acts as the backbone for the global economies and the brightest star of SE ASIA (Vietnam) is catching up fast with the international race towards countering alarming concerns for the rapid climate change.

M&A plays a critical role for the industry to flourish with a boosted financial model for the investors having distinct appetite. Mentioning of M&A leads our focus to the existing assets, assets under construction or planned projects that have a special purpose vehicle (commonly called as a Project Co.).

Driving any M&A deal through is a challenging task for not only the lawyers but for financial, tax and technical advisors. The key remains to have an eagle eye to sight the red-flags and provide a workable solution for the acquirers (investors). Negotiations on the other hand play a vital role in convincing the transacting parties to agree and not to agree to disagree on the table.

Outcome of the legal due diligence (“Legal DD”) decides the fate of the planned deal. Lawyers play an important role to row the boat to the shore in high and low tide scenarios while conducting the due diligence.

Industry should be mindful of some major issues that strike during the Legal DD process.

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