Choosing the Right Acquisition Structure
The most appropriate structure depends on the nature of the target business, the buyer’s objectives and the commercial risks involved.
A share acquisition may preserve contractual and operational continuity, while an asset acquisition may allow the buyer to select the elements of a business it wants to acquire.
However, neither approach is automatically preferable.
Tax treatment, third party consents, financing arrangements, employee obligations, regulatory approvals and the seller’s position can all influence the decision.
We work alongside accountants, tax advisers and other professionals to help clients assess the options before committing to a transaction structure.
Our objective is to ensure the legal arrangements support the commercial rationale for the acquisition rather than creating avoidable complications later.
Legal Due Diligence for Business Acquisitions
Buying a business involves more than agreeing a purchase price. Understanding what is being acquired, and the risks associated with it, is essential.
Our corporate lawyers conduct and coordinate legal due diligence, focusing on matters that could affect valuation, negotiations or the buyer’s willingness to proceed.
Depending on the transaction, this can include:
- Corporate records, ownership and share capital
- Key customer, supplier and financing agreements
- Employment arrangements and potential liabilities
- Intellectual property ownership and licensing
- Property interests and lease obligations
- Existing litigation and threatened disputes
- Regulatory compliance and data protection
- Change of control provisions and third-party consents
We provide practical recommendations on how identified issues should be addressed.
This may involve negotiating additional contractual protections, changing the transaction structure, consents or agreeing specific actions before completion.
Negotiating Acquisition Agreements and Buyer Protections
The purchase agreement is central to allocating risk between buyer and seller.
Our share and asset acquisitions lawyers prepare and negotiate transaction documents that reflect the agreed commercial terms and provide appropriate legal protection.
Particular attention is given to warranties, indemnities, limitations on liability, consideration mechanisms and completion obligations.
Where part of the purchase price is deferred or linked to future business performance, we advise on drafting provisions that clearly define how payments are calculated and when they become due.
We also address restrictive covenants, transitional arrangements and the seller’s continuing involvement where relevant.
Our approach is to concentrate on the provisions that genuinely affect the buyer’s commercial position while avoiding unnecessary negotiation over issues of limited significance.
Cross-Border Share and Asset Acquisitions
Acquiring a company or business in another jurisdiction can present additional challenges, particularly where different legal systems, regulatory requirements and commercial practices are involved.
IMD Corporate advises UK businesses pursuing international acquisitions and overseas investors acquiring businesses in the UK.
Our experience includes advising a major European manufacturer on its approximately £10 million acquisition of a UK competitor, as well as a NYSE-listed risk exchange platform valued at approximately US$4 billion on multiple acquisitions across the UK and Europe.
Cross-border acquisitions may require consideration of foreign investment restrictions, regulatory approvals, international financing, tax structuring and the enforceability of transaction documents.
Where legal advice is required outside England and Wales, we coordinate with overseas lawyers and other professional advisers while managing the UK legal aspects of the transaction.
We aim to provide clients with clear advice and coordinated execution, even where the transaction involves several jurisdictions.