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Building an M&A transaction structure is one of the decisive steps to the success of the deal. Choosing the appropriate transaction structure not only helps optimize benefits for participating parties but also ensures compliance with legal regulations. This article will analyze the types of M&A transaction structures and factors affecting the selection and construction of an effective M&A transaction structure.
M&A is the abbreviation for the terms Mergers and Acquisitions. Accordingly, M&A is understood as the activity of gaining control of a business through merger or acquisition between two or more businesses.
In other words, one business will partially or completely own another business through acquisition or merger. M&A activities bring many benefits to businesses such as expanding scale, increasing market share, accessing new technology, improving competitiveness…
Depending on the objectives, scale and characteristics of each transaction, parties can choose one of the following popular M&A transaction structures:
Asset acquisition is a common M&A transaction structure in which the buyer selects and acquires some or all of the target company’s assets. These assets may include land use rights, factories, machinery and equipment, intangible assets (trademarks, patents,…), and other assets with economic value.
Advantage:
Disadvantages:
The buyer will buy back shareholders’ shares or members’ capital contributions to own the target company.
Advantage:
Disadvantages:
Business merger is when one or several businesses transfer all of their assets, rights, obligations and legal interests to another business, and at the same time terminate their business operations.
Advantage:
Disadvantages:
Choosing the appropriate M&A transaction structure depends on many factors, including:
With a team of experienced experts in the field of M&A, Long Phan provides consulting services to build a comprehensive M&A transaction structure, including:
Building a suitable M&A transaction structure is a factor in ensuring the success of the deal. Long Phan, with a team of professional and experienced experts, will accompany customers throughout the process of implementing M&A transactions, from consulting, drafting contracts, to completing the transaction. Please contact us via the hotline: 0906735386 for detailed advice and best support.
Note: The content of the articles published on the website of Long Phan Investment Consulting Company is for reference only regarding the application of legal policies. Depending on the time, subject, and amendments, supplements, and replacements of legal policies and legal documents, the consulting content may no longer be appropriate for the situation you are facing or need legal advice on. In case you need specific and in-depth advice according to each case or incident, please contact us through the methods below. With our enthusiasm and dedication, we believe that Long Phan will be a reliable solution provider for our clients.
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