Buying or selling a business by the purchase or sales of its assets can be a detailed and complicated transaction. At Farleys we are able to guide you through every stage of the sale/purchase: from negotiating and drafting heads of terms, carrying out legal due diligence, negotiating and drafting the key transaction documents and ensuring that the acquisition is completed successfully.
When someone acquires a business by way of an asset purchase rather than a share purchase, they only acquire the assets and liabilities which the buyer and seller agree will be transferred. Despite that, the employment contracts of the employees of the target company will automatically transfer to the buyer under the ‘TUPE’ Regulations. There are a number of requirements set out by these Regulations and our business solicitors at Farleys can guide you through the compliance procedures.
Asset Purchase Agreement
It is important to ensure that an extensive agreement, known as an asset purchase agreement, is drawn up between the buyer and seller which should set out clearly all the terms of the purchase, including:
- Which assets are to be purchased;
- The purchase price;
- How the purchase price is to be paid and whether any part of that will be deferred;
- Any warranties to be given by the seller;
- Limitations on the seller’s potential liability for breach of those warranties;
- The obligations of each of the parties before and after completion;
- How income and outgoings before and after completion will be apportioned between the parties;
- How defective products and services which only come to light after completion will be dealt with;
- What happens to outstanding debts still owing to the business at completion;
- The transfer of the employees under TUPE;
- Any restrictions on the seller from competing with the business after the sale has completed.
Why Contact Farleys Business Solicitors?
Each business sale is different and it is therefore essential to ensure that you obtain comprehensive legal and accounting advice. Due to our experience handling business transactions and maintaining contact with companies of all sizes on a daily basis, our solicitors can provide practical business advice at every stage of the transaction to ensure that it is progressed efficiently and effectively from start to finish. We pride ourselves in taking a client focused approach; we will always make sure you fully understand anything you are being asked to sign and will strive to complete the transaction within your desired timescales and in a cost effective manner.