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OPINION
Proactively addressing these regulatory considerations ensures your firm remains in good standing, competitive, and positioned for long-term success. Maintaining proper licensure during M&A
M ergers and acquisitions in the architecture, engineering, and construction verticals can significantly impact a firm’s licensing requirements and ability to operate. Before entering into a transaction, management must consider key factors and ask strategic questions to ensure compliance. Management should consider leaning on professional advisers to help navigate these complexities and ensure ongoing regulatory obligations are met.
James Gilmer
KEY CONSIDERATIONS BEFORE AN M&A TRANSACTION. All firms must manage various interrelated state-specific licensing and entity registration requirements. M&A transactions introduce added complexity due to changes in personnel, structure, and company name. After a transaction, firms often face multiple registrations, renewals, and updates across different agencies within a short timeframe to maintain good standing. Each transaction presents unique challenges, but there are fundamental considerations for both the selling and acquiring firms. Management should proactively address questions such as, “How will our licensing needs change as we expand through M&A?,” and “What systems, personnel, and vendors
are required to complete the transaction and scale effectively?” CONSIDERATIONS FOR THE SELLING FIRM. The selling firm’s management should ensure: ■ All entities are properly registered and in good standing in every state where they operate. ■ All firm and professional licenses are active and in good standing. The firm is current with all tax obligations. Addressing these factors beforehand can streamline due diligence, reduce correction costs, and preserve the firm’s reputation during negotiations. ■
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THE ZWEIG LETTER MAY 5, 2025, ISSUE 1584
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