Virus Outbreak Could Lead Companies to Renegotiate M&A Deals

Companies are considering renegotiating previously announced mergers and acquisitions after the outbreak of the coronavirus, according to law firm Hogan Lovells.

Some dealmakers are seeking to change the terms of pending transactions, while others are postponing deals, Hogan Lovells said in a report Tuesday. In some cases, parties are weighing the possibility of triggering so-called “material adverse change” clauses that allow them to pull out of a deal agreement without the usual penalties, according to the law firm.

Healthy corporate balance sheets, private equity firms’ high amounts of capital and activist investors pushing for changes will all be triggers for ...