Why Use Many Contracts for One Deal?

Why do we memorialize some bargains in dozens of related contracts, rather than just one? Mergers and acquisitions deals, for example, are often formed through constellations of agreements that I call “unbundled bargains.” At the center of an unbundled bargain, there is a heavily negotiated acquisition agreement. Surrounding it, there are dozens of ancillary agreements that buttress the deal.

In a paper forthcoming in the University of Pennsylvania Law Review, and available here, I argue that unbundled bargains help parties design better deals ex ante and enforce deals more effectively ex post. I also argue that recognizing deals … Read more