Mergers and acquisitions
Considering the benefits of a merger?
Expanding your business through acquisition?
Sometimes organic growth may not be sufficient to meet a business’s objectives for expansion. If so, you may be considering the potential for growth via a merger or an acquisition strategy. A merger is the coming together of two or more enterprises for the purpose of mutual sharing of the risks and rewards of the combined entity. Importantly, significant resources do not leave the merged entity as a result of the combination.
An acquisition is where you acquire another business entity (either buying a business’s assets or shares). If you acquire the assets, you may then integrate that business into your existing business to form one enlarged company. Alternatively if your company acquires the shares in another company, the target company will sit below your company as a separately trading subsidiary as part of a group. You may wish to trade the target separately for some time so as to keep any liabilities within the target and not put the parent company at risk.
If you buy shares, you will have to pay stamp duty on the consideration paid for the shares. If you buy the business and assets, there may be a transfer or lease of property involved. Stamp duty will be payable at the rates published by HMRC. These additional costs should be borne in mind when budgeting for any acquisition.
If you are considering expanding your business through acquisition, then please contact the corporate team at Myers & Co. early in the process so that we can help advise you on the best course of action for your business.
Based in Stoke-on-Trent, Staffordshire, our corporate lawyers have a reputation for providing expert advice. For further advice contact Myers & Co Solicitors on 01782 577000.
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