Partner Perspectives: Alexandros Kosmopoulos

Could you comment briefly on the latest developments, market trends and challenges over the past 12 months and how have these affected the Corporate and M&A practice in your jurisdiction? 

The most important recent events have been the Russian invasion in Ukraine. The explosions and the supply chain as well as price inflation. These events sparked concerns around the security of supply in energy, commodities and goods, as well as volatility and unpredictability of prices. Businesses were reminded that the low frequency impact events, the virtual reality, we tend to think there is much more removed.

Two in the daily practice of relation. This translated into an increased focus on negotiating and renegotiating issues of issues related to the availability of resources, price adjustments, force majeure and material exchange. Additionally, the Ukraine crisis sparked the cycle of compliance reviews and sanctions notwithstanding, that appeared to decrease briefly in M&A. 2022 EU. In fact, we can say it is a memory year compared to the previous years.

The key business segments that benefited the energy real estate, including the reality and logistics assets, as well as financial services and information technology. Why did Greece perform badly, is the question. I think part of the answer is that Greece has maintained its growth momentum despite the debt crisis, and additionally, stronger banks have been able to inject liquidity and leverage both acquisitions and corporate expansions, including through the assistance of funds sourced through the recovery and resilience.

 

What trends do you expect to see over the next 12 months?

Well, for 2023, we expect a mixed bag of positive and negative trends. On the one hand, the risk continued uncertainty stemming from the Ukraine crisis. Inflation is most likely to persevere and interest rates remain high. Domestically, we expect activity to slow down until the Greek elections. On the other hand, Greece’s growth momentum is likely to endure, and the perception generally is that Greece will very soon reclaim investment grade.

If that happens, and we definitely hope it will, this will promote further increase in activity as well as a significant influx of foreign direct investment. I would personally also expect the growth in the number of exits because company valuations are expected to rise. Setting aside geopolitics and the economy. One prevailing global trend is advancements in technology that M&A activity is not going to be unaffected by it.

Although it may be too early to tell how exactly the business of clients and law firms will be affected.

 

What are the key areas of concern for clients engaging in M&A transactions? Which are the most important aspects/challenges counsels need to focus on?

Well, this is truly a vast topic, and we could be discussing it for hours. But let me try to highlight a couple of the aspects when it comes to client concerns. These obviously vary from one client to another. In fact, they are indicative of the client’s mentality, priorities and and philosophy.

Less experienced clients tend to have fewer and more basic requirements or concerns. Typically, these go around time and costs. More sophisticated clients have additional and more refined requirements, and these often come from company policies, but also, most importantly, from the accumulated experience of the organization. It is very important for counsel and client to sit down at the early stages of the transaction and discuss the particularities of and challenges of the transaction.

The client needs to understand particularly a foreign client needs to understand the basic legal environment in Greece. Understand what this business practice and what is not business practice. Understand how the the law firm proposes to operate. What are the key legal risks and what are the primary options for dealing with with risk? Equally, the firm needs to acquaint itself with the client, understand the priorities, understand the the limitations, but also understand the business context and the client’s long term plans.

Together, the client and the firm need to establish a communication structure to ensure that information can flow to the appropriate decision makers at the right times. In that particular context, I think the in-house legal teams can prove to be a very valuable asset because they can ensure that the way the transaction is implemented is consistent with with company policies and requirements.

It goes without saying that each transaction presents unique challenges. These may have to do with technical difficulties or with gaps in compliance or even managing the personalities involved. No matter what these challenges are. It is very important for the law firm to identify them as early as possible and make sure it adopts its approach to tackle them successfully.

 

How does AKL respond to such challenges and what is the approach it takes in order to help its clients address these matters?   

At AKL we believe it is of paramount importance to invest time and effort at the early stages in planning ahead for the transaction. We would typically sit down with the client and embark on on an informal diagnostic process. The purpose of the process is to make sure we staff our team with the appropriate expertise. We understand the client’s priorities and the business context of the Post-Closing plans.

We are able to properly design due diligence and establish a realistic timetable. In these early stages, we would equally establish liaison with the client’s other advisors and agree on a process to exchange information and discuss findings, often in an interdisciplinary environment or even across various jurisdictions. Within our internal structure, we designate a senior lawyer as coordinator amongst the various teams, including the due diligence team, the documentation team, and the acquisition finance team.

This is a very pivotal and sensitive role because it ensures that our deliverables are properly informed by the work of our colleagues and it also ensures that the client receives aligned service across the various constituents of our service delivery.

 

Are there challenges in M&A transactions that clients often underestimate?   

Yes, absolutely. Some of these challenges have to do with the Greek legal environment, and sometimes it is difficult or even embarrassing to have to explain to a client why particular approvals require so much time.

Luckily, the business environment has improved significantly over the past years and we do not encounter those issues that often. However, that is one aspect of transactions that clients tend to neglect, and this relates to Post-Closing actions. This can take obviously different forms depending on the transaction specifics, such as business combinations, changes in the policies and procedures transitioning to different systems or obviously management changes.

Ideally, we would want to have a very clear path to identifying and implementing those post-closing plans. By the time we are ready to sign definitive documentations. The key element 18 benefits from support from other practices within the system, including distinguished practice, is in real estate projects, disputes in banking and finance. Together, we are able to deliver high quality insights with due diligence as well as support the clients in implementing their Post-Closing initiatives.

 

Could you speak about some of your most memorable cases? What were the challenges for both the client and you and what qualities did you bring to the table? 

Well, there are obviously stories to be told about every transaction, but perhaps some of my most memorable experiences have been in the context of privatization transactions. And if I could, if I should pick one, that would be the Sports Authority privatization through sale of a majority stake. The context for the deal is that public opinion was divided around the privatization of strategic infrastructure.

Political leadership was undecided. And despite the fact that our client was very keen on swift execution of the deal, other stakeholders were resisting to steer away from the status quo.

There were tensions, including strikes or even riots outside the venue where the shareholders meeting was supposed to take place. In those circumstances, it is important to remain a good listener. Listening to all sides will help identify the root cause of all concerns and identifying every stakeholders concerns can assist you in coming up with more conciliatory approaches. It is also important to resort on a bit of creativity because creativity can lead you to substantially equivalent solutions that do not start some of the other side’s sensitivities.

 

What are AKL’s core values?

The vehicle logo contains three words that summarize what we value and identify with most insights trust and passion. Insight refers to knowing, well what we do and using it for the advantage of our client. Trust refers to trust within the team and to remaining trustworthy and reliable vis a vis our clients and the other professionals we interact with.

And passion refers to loving what we do and standing up for our clients interests and remaining dedicated to pursuing excellence. Akl has a longstanding history dating back to 1891. The firm’s longevity is really inspiring. It is not just a reminder that we need to adhere to sound principles, but also a reminder that we need to remain alert and sharp and reflections to make sure that we can steer the ship in the right direction while the world is changing.

 

What are the main features differentiating you from other law firms in Greece and what makes you a counsel of choice for clients in the corporate and M&A practice?

AKL is known for combining business sense with attention to detail. We deploy the specific teams that benefit from the correct expertise, and we make sure that all teams are guided at all times. From the response we partner, by the way, all of our partners are hands on practicing attorneys. Our due diligence is rigorous but focuses on the real risk areas.

And in parallel with a due diligence, we strive to come up with realistic solutions to tackle the findings. Generally, our approach is proactive from keeping the client informed to managing day to day issues, to updating the materials. And I’m very pleased to say that it is embedded in our philosophy and it is shared by all the stuff that we need to maintain and enhance our service delivery standards.