The M&A market is recovering in a K-shaped fashion: record activity in AI, healthcare and technology contrasts with continued stagnation in capital-intensive industries. Structuring challenges arising from interest barrier rules, anti-hybrid regulations, the EU AI Act and heightened antitrust scrutiny require a tax-precise and regulatory-robust deal architecture.
Persistent valuation differences between buyers and sellers are bridged via structured instruments. Earn-out agreements, participating preferred stock and vendor loans require precise tax qualification as equity or debt — with significant implications for ATAD interest barrier rules and Pillar Two effective tax rates.
Read full article →The interest barrier (§ 4h EStG in Germany; ATAD I Art. 4 EU-wide) limits the tax deductibility of financing costs to 30% of EBITDA. Cross-border LBO structures use hybrid instruments for optimisation — yet must rigorously comply with the anti-hybrid rules of ATAD II.
Read full article →Corporate separations require complex holding restructurings under the Pillar Two Subject-to-Tax Rule (STTR). This rule permits source-country withholding taxes on intra-group payments taxed at less than 9% in the recipient state — a material risk factor for established group financing structures.
Read full article →Consolidation in the AI and technology sector is generating disproportionately high M&A activity. Key challenges: the valuation of AI models and training data as intangible assets remains largely unregulated legally and fiscally; the EU AI Act creates new compliance obligations that must be embedded in the deal structure.
Read full article →The FTC (USA) and EU DG Competition are intensifying the scrutiny of megadeals in the tech and healthcare sectors. "Regulatory certainty" is becoming a central pricing factor in M&A negotiations. Material adverse change clauses must explicitly address and quantify regulatory approval risks.
Read full article →Net Asset Value facilities allow private equity funds to raise debt against portfolio value — without exit pressure and without diluting LP returns. Continuation vehicles, transferring assets into new GP-managed structures, require careful tax analysis regarding realisation events and Pillar Two implications.
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