Viktoriia Dobrynska: First I would like to note that mergers and acquisitions are really a very interesting topic especially in such business areas as the financial sector, agribusiness and TMT (telecommunications, media, technology). This year, a number of significant transactions were conducted in Ukraine, for instance, the merger of Rozetka and EVO Group. It testifies to the prospects of market segments mentioned above and the fact that such transactions will be successfully carried out in the future as well.

With respect to agricultural companies, I can't say that they are in the leading positions by the number of deals concluded. But as a rule, these are large transactions, the support of which requires much effort from the lawyer and insight into agricultural business. And we are interested in such transactions, complex and multifaceted.

Among the latest such M&A deals, I would highlight the Delta Wilmar CIS deal to acquire Chumak, which required us to fully cooperate with many of the company's lawyers.

Viktoriia Dobrynska: The acquisition of Chumak by Delta Wilmar is a special project for us. Its peculiarity lies in the whole business acquisition and we supported each stage of the transaction. We started with business audit, risk identification. The risks identified were included in the transaction documentation. The transaction was successfully concluded, and the integration of Chumak's business into the Delta Wilmar Group has already begun.

We had the most positive impressions from M&A support in the agricultural sector, in particular from the sale of Mriya Agroholding, although we did not participate in the transaction itself. But, of course, we followed it with enthusiasm. This is a four-year history, which has been successfully completed, and the dear to us project as we assisted in restructuring Mriya's debts. As a result, the consortium of creditors completed a successful transaction.

Viktoriia Dobrynska: We assisted today's Ukrainian branch of Goodvalley, Danosha, in acquiring assets of Galician Agricultural Investment. Goodvalley is expanding its production, so it needs a larger land bank. Acquisition of Galician Agricultural Investment provided for a 6.5 thou. ha increase of the land bank. In terms of forming the purchase price this was an uncommon deal. We analyzed the rental legal relations, and this was the price basis.

Actually, this year we have closed a number of interesting deals. This concerns not only the agricultural sector. For me personally, acquisition of a stake in Yarych Confectionery by Horizon Capital was much involving. This is indeed the case when I was imbued with a project, with sincere respect for the owner of the business, who built a large-scale and successful production. This is a good example of building a business in Ukraine. It was of high importance for us to establish a fair interests balance of all parties before the deal concluded to give the business an opportunity for further growth.

Viktoriia Dobrynska: Offering our clients complex solutions distinguishes us from other companies. When a client comes to us with a specific question regarding a M&A deal, we not only prepare transaction documentation for them, but also analyze the entire group of issues including corporate governance, taxation, etc. Having hired us, the client understands that he will be provided with answers to all questions.

Besides, we have an industrial insight. One can hardly underestimate the ability to speak a common language with the client when it concerns regulation, industry trends and development prospects. Ultimately, we offer our clients effective business solutions.

Therefore, our company actively involves partners in interaction with the client. For example, I work together with Anna Zoria, Head of M&A Practice at Arzinger. Together we hold negotiations, discuss features of deals and make decisions. It is important for the client that the project is supervised not by one lawyer but a team.

Viktoriia Dobrynska: This depends on the task set by the client. For example, our team went on a field trip as part of the process of preparing the Yarych transaction. But sometimes we can do without it.

In fact, work at Arzinger is accurately regulated. As a Senior Associate, I coordinate the work of the team. Often it is coordination not only within our M&A practice, but also among colleagues from other practices. This is especially applicable to large-scale audits. For example, several specialists are involved in due diligence.

This is the specificity of the corporate lawyer's work — he is not only a center of communication with the client, but also a center of information accumulation and processing. Thus, in addition to the professional competence, a lawyer must also have good managerial skills.

Viktoriia Dobrynska: I joined Arzinger in 2015. But I have been working in M&A practice since 2011 when I was offered a position in the corporate law department of Beiten Burkhardt. It is in this firm that I was lucky enough to support the acquisition of the chain of construction hypermarkets Nova Linia by Epicenter. And today doing shopping at Epicenter, I see how much it has improved. That brings us to the question of what I like about M&A practice. Its specifics is in the frequent occurrence of stressful situations, as everything needs to be done promptly — documents preparation and decision-making. But when you finalize a transaction, you feel the results of your work materialize. This brings great pleasure.

Viktoriia Dobrynska: Currently, indeed most of our clients are foreigners. But over the past three years, internal investors in Ukraine have also become more active, which is very encouraging. This is associated with the fact that in many sectors, including agriculture, there are powerful domestic players. Consequently, last year most of the transactions were initiated by domestic investors.

Although, there are no fundamental differences between foreign and Ukrainian investors in their approach to business acquisition and structuring a transaction legally.

Ukrainian investors are so to speak "closer to the field" in terms of assessing the situation in Ukraine, that is they are better informed. That's probably why they are more ambitious.

Viktoriia Dobrynska: Yes, sometimes they are. But the foreign investors we work with also understand the specifics of doing business in Ukraine.

Several potential investors are concerned about the situation with military conflicts in Ukraine. But big businesses that come to Ukraine do so consciously and do not ask such questions. They keep informed.

I have not seen an investor experience a culture shock after acquiring a business in Ukraine.

And that is a mutual process. Ukrainian investors, such as Kernel and MHP, operate in the international market as freely as they do in Ukraine. That is, Ukrainian business is gradually coming to the standards that exist in Europe and worldwide. I am very happy about it.

Viktoriia Dobrynska: Every deal is unique. Thus, there is no universal formula. In most cases, the transaction starts with an audit of assets by lawyers and financial experts. A protocol of intent is then drawn up. There the buyer indicates the desired price, having taken into account the potential or apparent risks of the asset he acquires.

Thereafter, if the parties sign the protocol, the transaction documentation is prepared on its basis. At this stage, if the seller needs to prepare the business for sale, for example, to divide it or restructure, he makes all the necessary arrangements.

The parties then sign a contract of sale, and if it is a joint venture, it is highly recommended to sign a shareholder agreement defining the rules of the game for the parties.

Obviously, in practice, much depends on the peculiarities of the transaction like the AMCU's authorization, the permission of creditors, etc. This is why the timeline may differ. The same for all transactions is only the final result — the transfer to the buyer of a share, a block of shares or a business as a whole.

Various situations may happen in the post-sale period. Indeed, there are clients who start with the management reshuffle. But there are also completely opposite situations when a client deliberately leaves key management positions unchanged to preserve people who have extensive experience in this business.

Everything is driven by the client's goal and willingness to achieve synergy. If one adopts radical changes in a new company, there will obviously be no synergy.

In our practice, after the acquisition, new owners preserved the key management. Naturally, the owner's representatives were part of the management. But it was a soft entry, as our clients acquired business to strengthen their own positions.

Viktoriia Dobrynska: This is exactly what happens in most transactions, as it directly affects the price of the asset, and it is often more advantageous for the seller to carry out pre-sale restructuring rather than to leave the restructuring to the buyer.

Viktoriia Dobrynska: This depends on the particular circumstances. In fact, big players including those in the agricultural market are usually well structured. These are model companies for executing transactions. They have everything logically and effectively built: corporate governance, clear structure.

Surely, there are companies unprepared for immediate sale as they have no clear internal structure and management system. But usually, as soon as a potential investor appears, the seller himself becomes interested in building a business to sell it higher.

Viktoriia Dobrynska: I think the land market opening will be a strong support for M&A deals since investors are waiting for it.

Large M&A deals are still made periodically. This is good news. The potential of the Ukrainian agricultural sector is real. However, if the land market is opened in Ukraine, the potential of the agricultural sector for M&A transactions will thrive.

Viktoriia Dobrynska: Yes, certainly. Among our clients in this category, there are large agricultural holdings that already operate in the Ukrainian market, as well as potential foreign investors.

Viktoriia Dobrynska: This is a simple equation with two knowns — there is spare money and there are investors willing to invest it. Investing in the Ukrainian land market will pay off. It is not a fact, but an axiom.

Viktoriia Dobrynska: I doubt that something will dramatically change with the opening of the land market. Most likely, the business consolidation trend will be preserved. Large agricultural holdings will get consolidated. This is how I see it.

Viktoriia Dobrynska: Perhaps. But I would like to stress that the introduction of advanced agricultural technologies and modernization of agricultural machinery create opportunities for even more efficient agribusiness.

Therefore, the expansion of the land bank may be attractive for agricultural companies for two reasons. Firstly, as a tool to maximize profits — the bigger land bank, the more profit one gets. And, secondly, as a development path within the framework of increasing the business efficiency through the use of modern technologies, thus reducing the cost of land cultivation and creating a reserve for land bank expansion.