LPC Law Notes Private Acquisitions Notes
A collection of the best Mergers and Acquisitions* notes the director of Oxbridge Notes (an Oxford law graduate) could find after combing through dozens of LPC samples from outstanding students with the highest results in England and carefully evaluating each on accuracy, formatting, logical structure, spelling/grammar, conciseness and "wow-factor".
In short, these are what we believe to be the strongest set of Mergers and Acquisitions notes available in the UK this year. This collection is f...
The following is a more accessible plain text extract of the PDF sample above, taken from our Private Acquisitions Notes. Due to the challenges of extracting text from PDFs, it will have odd formatting:
Asset Sale Vs Share Sale
Advantages of buying a business by Asset Sale
Due diligence
Limited to assets being acquired
Likely to be less disruption to the continued trading of the seller during the acquisition process
Less costly
Ability to choose assets to acquire
Buyer can “cherry pick” the assets it is willing to acquire and the liabilities it is willing to assume
GIVE EXAMPLE OF LIABILITY BUYER UNLIKELY TO WANT
Stamp Duty
Only payable on land
Integration
Might enable buyer to achieve synergy more readily than buying a standalone company on a share purchase
Instructions would need to be taken from the buyer as to its plans for integration post purchase
Disadvantages of buying a business by Asset Sale
Need to transfer individual assets
There will need to be individual transfers of the lease/supply contracts
Trade continuity
Work may be required to rebuild confidence
VAT
Payable on assets transferred unless TOGC (transfer of a going concern)
Assets must be used by the buyer in the same kind of business as that carried on by the seller
There can be no significant break
Buyer must be a taxable person, or become a taxable person as a result of the transfer
Advantages of selling a business by Asset Sale
Employees
TUPE 2006 protects an employee on an asset sale
The rights and obligations of the employees working in the identifiable economic entity will automatically be transferred to the buyer
Cherry Pick
Seller can choose with assets to sell and liabilities to transfer
Disadvantages of selling a business by Asset Sale
Ability to choose assets to acquire
Seller does not necessarily get a “clean break” from the business
Need to transfer individual assets
Seller will need third party consent to assignment, or novation, or to negotiate fresh contracts
Could be time consuming and require additional cost
Tax
Potential liability of gains arising on any assets transferred
May suffer double taxation
Depends on whether the sale proceeds are extracted from target by way of a voluntary winding up (potential chargeable gain as the winding up is considered a disposal of the shares) or by way of a dividend (companies do not pay corporate tax on dividends received from their subsidiaries
Advantages of buying a business by Share Sale
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Buy the full version of these notes or essay plans and more in our Private Acquisitions Notes.
A collection of the best Mergers and Acquisitions* notes the director of Oxbridge Notes (an Oxford law graduate) could find after combing through dozens of LPC samples from outstanding students with the highest results in England and carefully evaluating each on accuracy, formatting, logical structure, spelling/grammar, conciseness and "wow-factor".
In short, these are what we believe to be the strongest set of Mergers and Acquisitions notes available in the UK this year. This collection is f...
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