Asset vs Share Purchase: Considerations for Business Buyers and Sellers
Our new infographic summarises the key issues from both the buyer’s and the seller’s perspectives.
One of the most important choices when buying (or selling) a business is how to structure the sale. Both buyers and sellers will need to understand the implications of this.
Download our infographic on this topic here.
Business sales can be structured as either the sale of the company itself (i.e. the entity, usually a Limited Company in the UK), or the “business and assets” of the company, meaning that the buyer does not take on the entity itself but simply purchases some or all of the assets from the company. The former is known as selling all of the outstanding share capital of the company, or the “shares”, and the latter is known as selling the “business and assets” or simply the “assets”.
The choice of whether to sell (or to buy, from the buyer’s perspective) the whole company or simply the assets is an important one. It is multifaceted and should be addressed on an case-by-case basis under the advice of legal and accounting professionals. But many of the principles apply to all buyers and sellers of businesses in the UK, so we have captured these principles in an easy to follow infographic.
Originally published at www.hahnbeck.com on June 19, 2017.
