Mergers and Acquisitions
Are you buying or selling a business? Emerge can help you through both asset and share transactions. We conduct initial due diligence, assist in closing the transaction, and employ the use of technology to simplify the M&A process.
Thinking of Buying a Business?
What You Need to Know About Buying a Business...
Letter of intent
The first step is often negotiating a letter of intent. This ensures that buyers and sellers are on the same page about the primary business terms of the transaction.
We will investigate and review the documents on your behalf for the purpose of providing information and evaluating the business you are looking to buy.
The Final Agreement
An Asset Purchase or Share Purchase Agreement outlines the terms of the agreement between the parties. Terms include: purchase price, representations and warranties, conditions, and the closing date.
In addition to the final agreement, closing documents are prepared to give effect to the transaction.
Frequently Asked Questions
How does Someone Actually Buy a Business?
There are two core methods to buy or sell a business – an asset purchase or a share purchase.
What is a Purchase and Sale Agreement?
The Agreement of Purchase and Sale (APS) is a contract between a seller and a buyer for the purchase and sale of a business. The APS requires the buyer to buy and the seller to sell assets or shares of a corporation subject to the terms and conditions in the APS. Terms include: the purchase price, representations and warranties, conditions, and the closing date.
What are Closing Documents?
On the closing date of the sale of a business, closing documents are prepared and negotiated to give effect to the transaction. Depending on whether it’s an Asset Sale or Share Transfer, there is a difference in what closing documents are required to be signed by both parties.
What is the Difference Between an Asset Purchase and a Share Purchase?
A share purchase requires the purchase of all the shares of the company whereas an asset purchase requires the sale of individual assets.
With a share sale, the seller walks away from any liabilities and the buyer takes them on. This is different from an asset sale which allows the buyer to cherry-pick which assets it will purchase and which liabilities it will assume.
Why is Due Diligence Important?
One way to mitigate the risk of unwelcomed surprises when purchasing a business is to have lawyer conduct due diligence on the transaction. This means a lawyer will investigate and review the documents on your behalf for the purpose of providing information and evaluating the business you are looking to buy.
Tell us what you or your company require assistance with. Our legal team will be in touch shortly.
Toronto Office: 180 John St Suite 524, Toronto, ON M5T 1X5