Acquiring shares means first of all defining the scope of the transaction. In addition to ensuring that the seller is the owner of the shares he is transferring, you must ensure that he gives you what is known as an asset and liability guarantee. You must also ensure that the seller is entitled to transfer the shares to you and that you are entitled to become a shareholder.
To determine the scope of the transaction and to identify the guarantees to be requested from the seller, the buyer and its advisers generally carry out a preliminary audit, called “Due Diligence”. The acquirer and its advisors, based on prior discussions, specify the documents they wish to audit. These are then made available in a data room. Question and answer sessions are organised if necessary.
The letter of intent defines the terms and conditions of the due diligence, the rights and obligations of the parties during this pre-contractual phase if applicable already the essential terms of the transaction. If this is the case, at the end of the due diligence, the transfer agreement that will be drawn up will be limited to adjusting the letter of intent. If this is not the case, a negotiation will still have to take place in order to finalise a transfer project.
Along the way, the buyer will generally have to seek financing for its acquisition, whether it be equity provided by itself or by investors (before shareholder), mezzanine loans, vendor loans, etc.
We assist you with :
- Preparation
- pre-contract negotiations leading to the letter of intent
- drafting the letter of intent
- scoping of the due diligence questionnaire
- Q&A sessions
- negotiation and drafting of a sale agreement
- satisfaction of conditions precedent (closing)
- follow-up of post-closing obligations and operations.
Preparation for the acquisition may, if necessary, include identifying and structuring the desired financing arrangements for the acquisition (including setting up a special acquisition vehicle and establishing a shareholders’ agreement).
