Legal expertise plays only a small part in successful corporate divestment deals with in-house lawyers often consulted after the handshake, according to an annual survey of the M&A market published today.

Divestments are increasingly seen as an effective tool to increase shareholder value, international firm Eversheds’ Global M&A report 2015 says. However, only a third of in-house legal teams cite the application of legal or technical expertise as adding the most value to divestments.

Drafting contracts with sufficient flexibility to allow sellers to respond to changing circumstances was the most important contribution general counsel felt they could make.

More than two-thirds of in-house lawyers said they experienced tensions or significant differences with their business colleagues when planning a divestment.

According to the report the tendency of executives to shake hands on a deal before any legal issues were resolved was a common source of frustration. At the same time, ‘there was a widespread sense that legal teams with a low appetite for risk end up overcomplicating deals and lose sight of commercial drivers’.

A construction company GC said in the report: ‘When difficult issues arise on a sale, I hear “just hand it over to legal to sort out”. The speed of sale process versus deal certainty and protections in the documents need to be balanced.

‘If the deal moves too quickly it will only give rise to post-closing complications which come back to haunt the business.’