Jurisdiction(s):
United Kingdom

English High Court: draft disclosure letter statements can amount to misrepresentation in share sales, despite 'no representation' wording; Veranova v Johnson Matthey proceeds to trial; contrasts warranties with disclosures

Published on: 21 July 2025

Published by a LexisNexis Commercial expert

Legal News

Article summary

Veranova Bidco LP v Johnson Matthey plc and others [2025] EWHC 707 (Comm)

What happened?

Veranova Bidco LP v Johnson Matthey plc and others concerned the disposal of shares in a healthcare business. As is typical on a share sale, the parties negotiated:

a sale and purchase agreement (SPA), containing a number of warranties given by the sellers to the buyer about the condition of the target business, and
a disclosure letter, identifying the respects in which those warranties did not hold true

For further information on disclosure in the sale of a business, see the section below headed ‘What is a disclosure letter and how does disclosure work?’.

Following completion, the buyer discovered that, prior to signing the SPA and disclosure letter, one of the target company’s customers had received an offer to supply a particular pharmaceutical product at a substantially keener price than that at which the target had been supplying. This, in turn, triggered a contractual right for the customer to switch supplier and a corresponding right for the target company to requote to supply that product at a more favourable price...

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