M&A Terms of the merger agreement between Pfizer and Wyeth, which are “loose” compared with standards prevailing late last year, point to the new ways buyers, sellers and banks are attempting to spread transaction risk more adequately.
While many of last year’s deals almost forced the parties to sue each other to escape, Pfizer could potentially wriggle out of its $68bn agreement to buy Wyeth if its credit ratings drop below a certain level, or if its business suffers a “material adverse change”. In either case, the five banks that have agreed to finance the deal would have the option to back out of their commitments.
