An acquisition is the purchase of one business by another business and can take various forms. It could, for example, be:
- a share deal;
- an asset deal; or
- a distressed acquisition (from, say an Administrator).
The proper and appropriate handling of an acquisition is fundamental to ensuring the acquired business is integrated successfully into the buyer’s business.
What is the acquisition process?
The acquisition process will involve:
- negotiating the “Heads of Terms” for the transaction (i.e. the key terms of the agreement);
- thorough research into whether the business is worth the asking price (known as “due diligence”);
- questioning the sellers about any issues that arise during due diligence and analysing the responses; and
- drafting and negotiating the terms of contracts for the sale of the company or business to be acquired (whether by way of share deal, asset deal or distressed acquisition).
As a buyer, it is always better to know in advance about the issues affecting the target business – rather than relying on legal remedies after the sale such as a warranty claim. Our team of commercial lawyers can help in a number of ways, including the following:
- Advising on how to resolve issues that arise before completing on a purchase.
- Negotiating a price reduction or an alternative deal structure if issues have arisen in due diligence.
- Preparing and negotiating bespoke warranties and/or indemnities to be included in the deal documents. (Such warranties provide the buyer with appropriate protections and remedies.)
How can we help you?
We understand the pressures that arise during a transaction. Every deal is different and every buyer has their preferred approach to acquiring businesses.
If you are considering a business acquisition, our experienced team can help you identify acquisition targets and guide you through the process from start to finish. For example, we will:
- discuss the issues with you at the outset so that we understand your goals;
- identify which aspects of the target business are the most important and/or areas for concern and tailor our due diligence accordingly;
- establish a deal team headed by an experienced corporate lawyer. This leader can draw on expertise from our wider commercial team and will co-ordinate input from our specialists in commercial, employment, intellectual property and property law; and
- work closely with the external advisers involved on the buyer’s side, including funders and tax advisers, to achieve whatever timetable is required.