How A Law Firm Can Assist You In Your Private Equity Investment

Posted on: 16 February 2021

If you have a very high net worth, you might be considering investing in private equity. While there is nothing to stop you from investing in private equity on your own, you will be better off making this decision with the help of an attorney.

Forming the Funds

A private equity lawyer will assist you in forming the funds necessary to invest in private equity. For example, you will need to negotiate how you will contribute cash. The lawyer can help you set up funds for investors to contribute to. The lawyer will negotiate the finance documents and will close the sale. 

The Terms of the Contract

A private equity attorney will assist you in negotiating the terms of the contract. The lawyer will make sure that the deal happens and will also make sure that the deal is within the bounds of the law. 

The Structure of the Business

The lawyer will assist you in negotiating the acquisition of the business and will also negotiate the new business structure. These are situations where timing is of the essence, and it is essential to respect all confidentiality agreements. 

For example, the company might begin as a publicly traded company. You might then seek to acquire control of the company so you can then delist it from public stock exchanges. To acquire a company, a considerable amount of money is required, which is why you should hire an attorney.

Private Equity vs. Mergers and Acquisitions

Private equity investment and mergers and acquisitions are similar enough to where law firms often specialize in both. However, because private equity is an investment, the terms of the deal are more complex. The lawyer must have both commercial knowledge and legal knowledge. They must have knowledge of tax and finance law. 

When you are working with a corporate law firm, they will often have a broad range of offerings, and the assistance they offer in private equity investing is one of several services they offer. Therefore, you will want to work with multiple private equity firms that can help you make sure that you are in compliance with all rules and regulations.

After all of this hard work, an attorney may be able to assist you in obtaining a positive return on investment. Therefore, while working with an experienced law firm may come at a cost initially, the profits that result from this decision and avoiding regulatory fines will make this decision worth it.