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.
8 Things You Should Know About Buying a Business

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.