Three things that delay closing in an M&A deal.

Transactions · August 12, 2026 · 5 min read

The short answer

The three classic delays: third-party consents mapped too late; disclosure schedules that won't close because the data room wasn't in order; and reps-and-indemnity negotiation running to the last minute. What they share — every one of them could have been started on day one.

1. Third-party consents — the list discovered late

Material contracts of Israeli companies routinely contain change-of-control or anti-assignment clauses. In a share or asset deal, each is a consent to obtain — from someone whose timeline is not yours:

• Key customers — the most sensitive consent: the request itself reveals the deal, and poor timing invites renegotiation of the entire contract.
• The Israel Innovation Authority — a company that received grants is subject to the R&D Law: transferring funded know-how outside Israel requires the research committee's prior approval and a statutory redemption payment (capped at six times the grants plus interest, or three times if R&D activity remains in Israel for at least three years), and full payment is a condition for the approval taking effect. Acquisition of control by a foreign party triggers notification and undertaking obligations toward the Authority. With a foreign buyer this is a timeline to open early.
• Landlords, banks, infrastructure vendors — each with its own change-of-control clause.
• And at certain deal sizes — Competition Authority clearance, with statutory timelines goodwill cannot shorten.

The shortcut: consent mapping starts in week one of diligence — not after signing. Classify by materiality, assign an owner to each consent, and decide deliberately which are conditions precedent and which move to post-closing.

2. Disclosure schedules — where a messy data room presents its bill

Every representation needs a precise exceptions schedule: litigation, material agreements, IP, employees and options. When the data is scattered, every schedule draft breeds new questions, and every question a new cycle.

• The recurring Israeli findings: option grants never deposited with the 102 trustee on time, missing IP assignments from early-years freelancers, and database registrations and Amendment 13 compliance nobody kept current.
• The shortcut: vendor due diligence — the company examines itself before the buyer does. Fixing a problem before it is found costs a fraction of explaining it after, and a data room built properly from day one saves weeks.

3. Reps and indemnities — the negotiation that refuses to end

After price, this is the deal's most contested ground: caps, survival periods, baskets and deductibles, and the interplay between general indemnities and specific items diligence surfaced.

• What accelerates it: agree the risk architecture early — cap as a percentage of consideration, tiered survival (fundamental and tax reps vs. operational ones), a sensible aggregate basket — leaving only the numbers for the end.
• Warranty & indemnity insurance has become common in mid-size Israeli deals too: it moves most of the risk to an insurer and shrinks the friction surface dramatically — but its underwriting process is itself a timeline to start early.
• Escrow or holdback — the practical answer to whatever gap remains: a defined amount, a defined period, an automatic release mechanism.

Frequently asked

How long is "normal" between signing and closing?

A private deal with no regulatory approvals can sign and close simultaneously or within a few weeks; a deal with Competition Authority clearance, Innovation Authority approval or multiple customer consents — months. The difference is almost always set by the list in section 1.

Fix problems before the deal, or disclose them in the schedules?

Fix. Disclosure protects legally (the rep is qualified) but not economically — every disclosed problem gets priced, usually at more than the cost of fixing it. Whatever cannot be fixed in time — disclose fully, because an inaccurate rep becomes an indemnity claim.

The above is general information only, current as of the date of publication, and does not constitute legal advice or a substitute for advice on your specific circumstances. Consult a lawyer before acting.

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