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...
1
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.
2
Due Diligence
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.
3
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.
4
Closing Documents
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.