Accounting, internal controls, and damages in an M&A matter

A law firm retained Brattle to work on behalf of a private equity firm that had sold one of its portfolio companies. The buyer of the acquired company alleged that the company’s financial statements inflated the carrying value of its fixed assets. As a result, the buyer accused the private equity firm of breaching certain representations and warranties in the acquisition agreement. A Brattle principal analyzed and opined regarding the acquired company’s accounting and internal controls for fixed assets, and damages issues. The matter settled favorably for the client.