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      Mergers and acquisitions (M&A) are high-stakes moments for any business – a blend of ambition, risk and negotiation under pressure. Yet, once the ink on the contract has dried, the true value of the deal ultimately rests on a few crucial pages of the sale and purchase agreement (SPA).

      The SPA sets the foundation for trust in post-deal collaboration; translates intentions into obligations; and defines whether value will be protected – or lost. 

      Turning a commercial deal into an enforceable, risk-balanced blueprint takes deep accounting expertise and deal structuring skill. Yet, in Switzerland especially, the SPA is often seen as a legal formality rather than a strategic safeguard. As deal structures become more complex and processes more compressed, it’s time to recognize the role of the SPA in making or breaking a deal.

      In this article, we explore why trust is a key value driver, examine the trends making SPA expertise a strategic imperative and share our insights into SPA priorities for dealmakers.

      Shelley Reader
      Shelley Reader

      Partner, Deal Advisory, SPA Advisory

      KPMG in the UK

      Timo Knak
      Timo Knak

      Partner, Head of Deal Advisory and Head of Mergers & Acquisitions, Sector Head Private Equity

      KPMG Switzerland

      What is an SPA?

      A sale and purchase agreement (SPA) is the central contract that defines how a deal is executed, valued and protected.

      The SPA translates the commercial value hypothesis into legally enforceable terms, setting out the purchase price mechanics, closing mechanisms and risk allocation between buyer and seller. It is informed by any diligence issues raised during negotiations and provides contractual clarity on key areas such as closing mechanisms, closing adjustments, earn-out provisions, leakage provisions, liability caps, accounting policies and settlement of inter-company balances.

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      The value of trust throughout the M&A lifecycle

      For business leaders, the M&A process goes beyond valuation. Both sides need clarity, trust and confidence.

      A well-structured SPA fosters transparency between buyer and seller, draws a well-defined line around key risks and gives both parties the reassurance that the deal they think they are making is the deal that will be executed.

      When expectations are explicit rather than assumed, negotiations become smoother and far less susceptible to last-minute surprises.

      SPA specialists play a crucial role in this dynamic. Their technical expertise and practical experience are instrumental in translating financial due diligence insights into clear contractual terms.

      Working together, accountants, tax advisors and legal counsel ensure that complex accounting or operational findings are understood in a commercial context. Their work establishes a shared language for how value will be measured, adjusted and protected at every stage of the transaction.

        Depending on the specific circumstances surrounding the transaction, SPA specialists can advise on a range of areas to eliminate ambiguity from the SPA and support the intended outcomes.

        In cross-border transactions and culturally diverse environments like Switzerland, professionals with awareness of local aspects on all sides can help create a common understanding of the SPA’s concepts, processes and expectations. In a multilingual context – often the case within Switzerland or in international transactions – decisions on which language version to designate as binding should also be made consciously.

        Contractual clarity is not just about risk mitigation; it makes for a process that is more predictable, less adversarial and conducive to effective collaboration. As each side feels informed and protected, trust builds rather than erodes, enabling relationships that endure beyond signing and strengthening the foundations for successful integration and long-term value creation.

          Trends driving the strategic imperative for SPA expertise

          In an environment of increasing deal complexity, attention to detail is crucial. Overlooking relevant points, understating values or assuming that commercial understanding will take precedence expose both sides to value attrition. In contrast, time and effort spent on drafting the SPA is a direct investment in value preservation.

          Traditionally, SPA drafting has been the domain of lawyers. Today, more than ever, the financial and purchase price mechanisms embedded in the SPA should be informed by interdisciplinary transaction advisory services. In other words, legal expertise must be complemented by deep accounting and taxation knowledge – and an ability to exercise professional judgment.

          We note three trends that are accelerating this need:

          Rising dispute frequency

          We observe a general increase in post-closing legal action in Switzerland and beyond as contractual parties – on both sides – challenge adjustments, working-capital targets or leakage definitions. 

          In many cases, post-closing disputes stem not from bad intent but from ambiguity or a lack of precision. With more transactions ending in expert determinations, intentional and accurate SPA wording has become a defensive necessity.

          Deal complexity & carve-outs

          Increasingly intricate deal structures – from partial divestments to carve-outs with shared services or transitional arrangements – create far more ambiguity around what exactly is being transferred. 

          In such transactions, assets and allocations may be harder to untangle, leaving more room for interpretation unless the SPA is drafted with a focus on rigorous financial clarity.

           

          Compressed deal timelines

          In our fast-paced, digital world, stakeholders increasingly expect rapid progress from first contact to closing. 

          But when teams rush, gaps can emerge between what financial due diligence uncovered and what the SPA ultimately reflects.

          Without tight coordination, critical findings can be diluted or omitted altogether. 

           

          Bringing accounting and taxation specialists into the SPA process ensures that the price agreed is the price paid. Both sides of the transaction benefit from a smooth post-deal process, and can sidestep any need for reactive problem-solving, safe in the knowledge that value is protected. 

          From our experience

          Case study: (mis)interpreting intent 


          An international manufacturing conglomerate headquartered in Europe lost EUR 30 million in post-deal adjustments due to vague, unclear and unprotective drafting.

          The SPA had failed to provide for a clear definition of “debt-like” instruments. This single ambiguous clause – which the buyers interpreted to their advantage – ended the promise of a profitable deal and triggered a prolonged and costly dispute. What followed? A year of expert determination, significant legal costs and an eroded relationship between buyer and seller.

          Scenarios like this aren’t as rare as you might hope. Even small technical oversights, vague accounting definitions, inconsistent accounts or unclear leakage clauses can materially impact transaction value. But it’s certainly not inevitable. An SPA drafted by experienced and knowledgeable professionals safeguards value protection for both sides.

          Leading practices: a cultural perspective 


          In markets such as the UK and Germany, specialist SPA advisory support is already standard practice during the M&A process. Clients recognize the value of investing in SPA expertise alongside legal counsel at the negotiation table.

          In Switzerland, this approach is not yet well established despite the country’s cultural preference for precision, predictability and consensus-building. However, we note an emerging shift in the same direction as other European countries. This is hardly surprising given that Swiss dealmakers face many similar challenges: complex group structures, frequent carve-outs and a lively market for cross-border transactions.

          We believe that Swiss dealmakers should – and will – increasingly emphasize contractual clarity, with a deliberate focus on precision in the SPA as the best protective mechanism.  
           

          SPA priorities for dealmakers in Switzerland

          Based on hundreds of transactions and post-deal dispute resolutions, we have identified five key focus areas to consider when drafting the SPA:

            • Define financial terms rigorously

              The final consideration payable is based on a special purpose set of financials derived from a commercially negotiated position: agreeing a set of robust principles upfront avoids costly ambiguity and interpretation later.

            • Avoid unintended adjustments

              Simplicity in purchase price mechanics and closing adjustments reduces the risk of unintended ambiguity, biased interpretation or “gray areas,” which in turn cuts the risk of lengthy dispute processes.

            • Set the right working capital target

              This fixes the benchmark for the closing adjustment and directly anchors the final equity value. Once agreed, it cannot be revisited, so any miscal­culation flows straight through to value.

            • Review leakage clauses early

              Even well-structured locked box mecha­nisms can fail without clarity on what constitutes “permitted leak­age,” leading to value loss even when buyers have the best intentions.

            • Integrate due diligence insights directly into the SPA

              The link between findings and contract wording must be deliberate and effective.

            For a rigorous SPA tailored to the specific transaction, dealmakers should seek accounting, taxation and legal advisory services from their trusted providers.

            They should also look for advanced technological capabilities; data analytics in M&A and predictive insights are emerging as powerful tools to enhance the efficiency and reliability of deal execution and post-closing integration. 

            Why the SPA matters

            In today’s fast-moving M&A environment, SPA expertise is not a technical luxury for Swiss dealmakers, it’s a strategic necessity.

            They should ensure that their SPA is informed by expertise across key areas: 

            • Legal

              Legal counsel remains essential to ensure that terminology, disclosure standards and risk allocation are aligned across jurisdictions and understood consistently by all parties.

            • Taxation

              In light of Switzerland’s layered federal, cantonal and municipal tax system, it makes sense to buy in specialist taxation knowledge to eliminate unnecessary post-closing exposure.

            • Finance

              Accounting specialists can help define robust purchase price mechanics, validate working-capital targets and ensure that Swiss GAAP FER or IFRS nuances are intentionally reflected in the SPA.

            A consciously drafted and technically sound SPA ensures that commercial intent is translated into financial reality, with built-in consideration – and mitigation – of foreseeable risks.

            The result?  A deal that delivers on its promise and protects value for all stakeholders. 

            Maximize long-term deal success with sale and purchase agreement clarity

            Even with a strong strategic rationale and attractive valuation, deals can still leak value after signing. Too often, the sale and purchase agreement is treated as a legal formality – when it’s the mechanism that turns intent into enforceable outcomes.

            How can we ensure both sides leave the table confident that the deal they think they are making is the deal that will actually be executed?

            Explore more

            Meet our experts

            Shelley Reader
            Shelley Reader

            Partner, Deal Advisory, SPA Advisory

            KPMG in the UK

            Timo Knak
            Timo Knak

            Partner, Head of Deal Advisory and Head of Mergers & Acquisitions, Sector Head Private Equity

            KPMG Switzerland

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