Cromie Featured in NJBIZ Article on Transactional Lawyers and Current Economic Turbulence

NJBIZ magazine
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ROSELAND, N.J./October 24, 2008 -- Connell Foley partner John D. Cromie, a member of the firm’s Corporate and Business Law practice group, is featured in an article published in the October 20, 2008 edition of NJBIZ magazine on the slowdown of transactional work for New Jersey’s corporate and transaction lawyers as a result of the current volatility in U.S. and world financial markets.

The article, “Wall Street Adventure for Venture Capital Lawyers,” written by Martin C. Daks, points out that today’s unstable financial markets have significantly decreased private equity deals that often focus on later-stage or mature companies.

“There’s been a broad-based pullback in transactional deals involving private equity,” said Mr. Cromie.  “People in general are adopting a more conservative approach in the face of a soft economy and tight credit market.  It means there is an additional level of challenge to get deals done.”

The frayed nerves of players in the financial markets could also affect deals already in the making, Mr. Cromie indicated. “We’re seeing some buyers and sellers scour the documents for escape clauses, even when they signed the deals months ago,” Mr. Cromie said. “They often focus on material adverse change, or MAC, clauses that may let them back out if there’s been significant change in the [selling] company’s market position, or if the buyer is unable to get financing.”

Mr. Cromie stated, "Current market conditions may cause far-reaching and long-term changes in how transactions are done."

“After this shakes out and the economy stabilizes, I believe that the market [for venture and private equity activity] will bounce back. But in the future, we’re likely to see buy-sell deals at realistic values based on the true worth of the underlying assets, instead of the inflated valuations we’ve been seeing in recent years,” Mr. Cromie added.

For more information, please contact John Cromie at 973-535-0500 or


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