International Corporate / M&A – Bulgaria

The LTA Consulting team is acutely aware of the importance of M&A (including international transactions) and the strategic advantages they bring to businesses. We have a great deal of experience of the Bulgarian market, combined with international expertise and a networking capability. This ensures our clients receive optimal legal, financial, tax and accounting services, which in turn helps them to achieve their goals.

The comprehensive service we provide to our clients also allows us to have a holistic view of their business development. In this way, we help them make important business decisions and deal with emerging problems.

LTA Consulting’s team consists of professionals united by the view that there is no universal rule for achieving excellent results. The company maintains active cooperations with consultants in the fields of law, finance, tax and planning from almost all member states of the EU, as well as those in England, Türkiye, North Macedonia, Serbia, Ecuador, Peru, Brazil, Indonesia, Dubai, Morocco and Australia, among other areas.

The key laws governing M&A transactions are the Commerce Act and the Obligations & Contracts Act. The Commerce Act regulates the creation, management, representation and legal structure of entities in Bulgaria, as well as their sale, dissolution, conversion through mergers, liquidation and bankruptcy. It also applies to public companies, unless otherwise stated in the Public Offering of Securities Act. M&A contracts are governed by the provisions of the Obligations & Contracts Act, which covers such elements as terms, validity, performance, default, security and termination. There are no compulsory licensing requirements for parties providing advisory or service-related support for M&A transactions. Depending on the specifics of each M&A transaction, the applicable regulatory framework for the relevant industry will be enforced.

As a legal consultant in M&A, our workflow is structured around four main phases: pre-transaction planning, negotiation and documentation, due diligence and regulatory compliance, as well as post-closing support.

Pre-Transaction Planning: Our team begins by understanding the client’s strategic goals, whether for acquisition, divestiture or merger. This includes evaluating potential risks and structuring the deal, often in collaboration with financial and tax advisers.

Negotiation & Documentation: During this phase, we draft key agreements, such as the term sheet and Sale & Purchase Agreement (SPA), and ensure the terms are aligned with the client’s objectives. Negotiations focus on purchase price, warranties and indemnities.

Due Diligence & Regulatory Compliance: Our team coordinates in-depth due diligence to identify legal, financial and operational risks. For cross-border deals, this includes ensuring compliance with relevant regulations and antitrust laws, as well as managing filings for regulatory approvals.

Post-Closing Support: After closing, we assist with integration, dispute resolution and ensuring compliance with post-transaction obligations.

In the current climate, clients are seeking guidance on:
• Cross-border transactions due to global market expansion;
• Distressed M&A as companies face economic pressures;
• Technology and IP acquisitions to stay competitive;
• ESG compliance in response to increased regulatory and consumer demands;
• Tax optimisation to navigate global tax reforms.

Economic uncertainty, rising interest rates and geopolitical tensions, as well as rapid technological advances and increased regulatory scrutiny, have prompted companies to restructure, acquire distressed assets or expand into new markets.

Our team has significant M&A experience and has been involved in the structuring of such transactions in the investment, food and retail industries. Our experience and expertise in this field allow us to develop an individual strategy for the successful completion of each transaction.

Recent M&A activity has been significantly influenced by factors like inflation, supply chain issues, political uncertainty, security risks and energy pricing. These elements have shaped both the strategic intentions behind deals and the way transactions are structured. Companies are more selective in their M&A pursuits. Some are focusing on distressed assets, hoping to acquire them at a discount, while others are revising deal structures to account for higher costs – or are seeking financing options with better terms. Ongoing supply chain disruptions, exacerbated by geopolitical events like the war in Ukraine, have heightened the importance of strategic acquisitions in such sectors as logistics, manufacturing and technology. Political instability has led to caution in cross-border M&A. Meanwhile, cybersecurity concerns are now a primary focus in M&A, particularly with increasing cyberattacks, as buyers are conducting more thorough due diligence on a target’s cybersecurity infrastructure and data privacy practices.

These factors have combined to make M&A more cautious, with an emphasis on strategic diversification, risk mitigation and adjusted valuations. Companies are, increasingly, using M&A as a tool to either stabilise their operations or position themselves for future resilience in a volatile global environment.

M&A activity is heavily influenced by technological progress, shifts in consumer behaviour, energy transition efforts and post-pandemic recovery, creating strong deal activity across such sectors as technology, healthcare, energy, FinTech and consumer goods.

Recently, we have worked with a mixture of both large firms and SMEs. Large firms are increasingly focused on global expansion, digital transformation and ESG goals, driving M&A activity, especially in sectors like tech and healthcare. Moreover, SMEs are seeking growth capital, succession planning or exit strategies through M&A. The rise in private equity involvement and post-pandemic recovery efforts is fuelling this.

Both sectors require legal expertise to navigate complex deals, but the overall mix is driven by the need for strategic growth, market adaptation and capital access in a dynamic economic landscape.

Our team advise entrepreneurs on structuring their business to protect their personal assets and ensure tax efficiency by choosing the correct corporate form (LLC, corporation, etc.). We assist in protecting IP, including trademarks, patents and copyrights, to protect unique assets.

Contracts with employees, suppliers and customers are crafted to clarify terms and prevent disputes.

We also advise on compliance with the relevant regulations (e.g., GDPR, anti-money laundering measures, tax laws), as well as risk management practices.

We further assist with dispute resolution strategies and exit planning for future growth or transition.

Overall, our advice ensures legal certainty and a solid foundation for long-term business success.

We ensure a well-informed global advisory scope by maintaining a strong network of international legal experts, collaborating with local firms and participating in global networking events and conferences. In addition, we leverage technology, legal databases and continuous learning to stay updated on jurisdiction-specific regulations and trends for cross-border clients.