Vendor contracts 101: M&A considerations
As banking industry consolidation continues, negotiating vendor contract provisions now can save headaches and money later.
As vendors lose customers to consolidation, they impose harsh early termination fees. You may be able to negotiate a break, according to Fredrikson & Byron’s Caitlin Houlton Kuntz.
Banks can save significantly by negotiating conversion or deconversion pricing and logistics. Houlton Kuntz also recommends reviewing both sets of contracts for any exclusivity provisions that would prohibit the bank from obtaining similar services from other vendors.
“If an M&A event might be in your bank’s future, do yourself a favor now and be meticulous in your record keeping.”