Czech Republic client case studies in 2022
Purchase of a licensed financial institution in the Czech Republic
- Our Client is a leading payment company in Malaysia and was looking to expand their operations. They engaged Healy Consultants Group PLC with the intention to purchase a licensed financial institution in any jurisdiction. To advance, our Client settled a retainer fee with our Firm.
Phase 1- Sourcing for a suitable licensed financial institution
- Within two weeks, Healy Consultants Group PLC contacted our local brokers and lawyers and supplied a comparison table of five financial institutions available for sale, and which met our Client’s criteria. The table of comparison included i) purchase price ii) minimum paid-up capital iii) number of employees iv) regulators and v) the type of license;
- While Healy Consultants Group PLC was communicating aggressively with our local brokers and lawyers, our team assisted our Client to prepare non-disclosure agreement, source of wealth and source of funds. These documents were essential to show the brokers that both Healy Consultants Group PLC and our Client were sincere buyers, and not just fishing for information;
- After conducting more due diligence on the available entities, our Client decided to proceed to purchase a licensed financial institution in the Czech Republic. As such, our Client settled a second retainer fee for Healy Consultants Group PLC to assist with the acquisition.
Phase 2- Preparation for ownership transfer
- Healy Consultants Group PLC prepared an engagement strategy document including i) important regulatory and legal considerations ii) SWIFT and correspondent banking considerations iii) accounting and tax matters and iv) strategies we recommended implementing to complete the purchase. In addition, our team continued to aggressively negotiate with the seller regarding purchase price and other relevant terms and conditions;
- Our team prepared a detailed Engagement Project Plan for our Client, mapping each step and timeline required to successfully acquire the licensed financial institution. This included preparing documents such as i) escrow account agreement ii) reservation contracts and iii) sales agreement. Once all parties signed the same, our Client travelled to the Czech Republic to sign the paperwork in front of a Notary Public;
- To date, Healy Consultants is waiting for our Client to release the funds in the escrow account, after which he will successfully acquire the licensed financial institution.
Challenges and solutions during the engagement
- While deciding which was the optimum licensed financial institution to purchase, it was essential for our in-house M&A team to work closely with our Legal and Compliance team. This was to ensure that the licensed financial institutions were legitimate and compliant with all local regulations;
- To do so, Healy Consultants Group PLC had to obtain further supporting documents for each financial institution;
- Only after much negotiation and video conference calling was our team was able to obtain the same.