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A business merger is a strategy that helps companies expand their scale, optimize resources, and enhance their competitiveness in the market. To carry out a successful merger, businesses need to master legal regulations and carefully evaluate relevant factors. Below, Long Phan will present issues that businesses need to pay attention to before and after conducting business mergers.
Pursuant to Article 201 of the Law on Enterprises 2020, business merger is the process in which one or several companies (hereinafter referred to as the merged company) can merge into another company (hereinafter referred to as the receiving company merger) by transferring all assets, rights, obligations and legal interests to the merging company, and at the same time terminating the existence of the merged company.
The merger must comply with competition, tax and labor regulations under current law. The merger process is clearly regulated to ensure transparency. Compliance with legal regulations is a key factor.
According to Clause 3, Article 201 of the Law on Enterprises 2020, merging companies must comply with the Law on Competition to ensure fairness in the market. Article 29 of the Law on Competition 2018 considers mergers as a form of economic concentration, which can improve competitiveness but also poses the risk of monopoly. Therefore, Article 30 of the Law on Competition 2018 stipulates that mergers are only allowed if they do not cause or are likely to cause a significant impact on restricting competition in the Vietnamese market.
To optimize benefits and minimize risks, businesses need to prepare a detailed merger plan, evaluate cultural and legal factors, and establish an appropriate new management system.
The business merger process requires careful preparation and a clear strategy. Enterprises need to build a detailed roadmap for each stage. Meticulous planning helps minimize risks and increase the chances of success.
Pre-merger period plays a decisive role in the success of the entire process. Businesses need to conduct a comprehensive legal appraisal of their legal status, assets, liabilities and potential disputes. The detailed financial assessment includes reviewing the financial statements, cash flows, assets and liabilities of the parties participating in the merger. At the same time, accurately determining business value through appropriate valuation methods will create a basis for negotiation and negotiation.
Resource preparation work Finances need to be calculated in detail. Enterprises must fully budget for the merger process, including consulting costs, appraisal fees, legal costs and contingencies. Assessing the impact on stakeholders such as shareholders, investors, customers and partners also needs to be done carefully to have appropriate handling plans.
During the merger implementation phase, compliance with the legal process is key. Enterprises must ensure that procedures are carried out in the correct order, with complete documents and on time according to the provisions of law. Information and communication management needs to be focused to avoid negative impacts on the reputation and operations of businesses. Maintaining stable business operations during this period is especially important so as not to affect revenue and profits.
After completing the merger, Restructuring requires high concentration. Rearranging the management apparatus needs to ensure efficiency and compatibility with the new scale of the enterprise. The process of harmonizing corporate culture between parties needs to be done delicately to avoid conflicts and create a positive working environment. Businesses need to build new operating processes, optimize resources and establish appropriate management systems.
Human resource management after merger requires professionalism and sensitivity. Enterprises need to have clear policies on the arrangement, transfer and training of personnel. Building appropriate remuneration policies will help retain talent and maintain team motivation. At the same time, businesses need to establish a performance evaluation system to ensure long-term development goals.
Post-merger monitoring and evaluation process needs to be done regularly.
Finally, building a new development strategy needs to be based on the advantages and potential of the post-merger business. Businesses need to clearly identify short-term and long-term goals and propose specific solutions to achieve these goals. Taking full advantage of the advantages of scale, market and resources will make an important contribution to the sustainable development of the business in the future.
Long Phan provides professional consulting services, specifically focusing on strategic and legal needs during business mergers. These services not only support businesses at each specific stage but also provide an overall roadmap from start to finish, ensuring the merger process takes place effectively and legally.
In-depth and comprehensive consulting and support services at Long Phan include:
The business merger process requires careful preparation and a deep understanding of the law. Long Phan commits to accompanying customers throughout the merger process, ensuring legal compliance and optimizing benefits. Contact Long Phan immediately via the hotline 0906735386 for detailed advice and best support for your merger project.
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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