Do I Buy The Assets Or The Shares In The Company I Want To Buy (The Target)
When you are looking at a company or business purchase, for a buyer the answer will usually be that it will be simpler quicker and more cost effective to buy the assets of a business rather than the shares itself. For the seller it will usually be more tax effective to sell the shares in the business. The reasons for this view are outlined below. In our opinion, selling the business assets rather than the shares (i.e. a business sale) will usually result in quicker more cost-effective deals because the rules on financial assistance do not apply to asset sales (see below) and the buyer can be more selective about which assets (and liabilities) the buyer takes on.
Legal Effect
Where a buyer acquires shares in the Target, the accrued liabilities of the Target remain in those shares, hence extensive warranties and disclosures are sought by the buyer to ensure as far as possible the legal position of the buyer. With asset purchases, the liability of the Target remains in the hands of the seller and the buyer has greater scope to cherry pick which assets she or he wishes to acquire. In...
To view and download this full PLR article, you must be logged in. Registration is completely free. Once you create your account, you will be able to browse, search & downlod from our PLR articles database of over "1,57,897+" on 1,000's of niches and 200+ categories without paying a penny. Click here to signup...
