When discussing licensed data, most people know the data comes with no ownership rights just a copy of the data that can be used for exploration. Licensed data cannot be transferred from company to company in asset deals or divestitures. However, showing this data in a data room as part of an asset transfer or divestiture is acceptable (sometimes requires consent).
I recently had a geophysicist realize that the seismic data was not included in a deal (data they really needed), because it was only licensed to the company. They tried to get it after the fact. At this point it was 100% retail cost and his company didn’t have budget for it. If it had been negotiated earlier this could be avoided, not only saving money but also enhancing the deal with data to the new owner.
If data shown in a data room as part of an asset transfer is identified as licensed, then the purchaser can contact a Broker to obtain a license to this data and know what the costs will be regarding their budget. These costs can be worked into the deal before closing to make sure the total asset package is what the company needs.
If the data is not identified, and does change hands, this puts both companies in breach of the license agreement and leaves them open to liabilities.
In cases when the seller owns the propriety rights of the data, the seller can grant a licensed copy if they own it 100%. If they have a partner on the data, then the partner needs to not only approve but also be compensated. This is where using a Broker can save time and money. A Broker can identify current partners, obtain approvals, generate a license agreement for the data, and affect payment to the partner. They can even make sure the purchaser has a proper license agreement for the 100% or exclusive data as well.
If your company is entering in some sort of merger, divestiture, acquisition etc…. please give me a shout. I’d happily give you some advice and help the process along, hopefully saving you from some headaches along the way.Back