Stephensons Solicitors LLP Banner Image
Stephensons Trustpilot stars
Based on count 1213
View all reviews

Asset sales - selling or buying a business

If you are thinking of selling or buying a business an option available would be to conduct this through an asset sale.

When commencing an asset sale the buyer acquires the agreed areas of a business which is sometimes referred to as the target business. For example, a larger corporation could opt to only buy the operations of a business, without the purchase of the company as a whole or the individual shares. The sale can include the target’s contracts and good will or a defined portion of each.

It is a relatively flexible approach for buyers, allowing them to select particular assets instead of acquiring the business as a whole via the share sale route. For the buyer, this type of sale is sometimes seen as less risky, making the contract and transaction simpler.

loading staff

In an asset sale the seller is the business as a whole (whether this is a limited company, LLP, individual or a partnership) rather than the individuals of that entity. Although an assets sale can be seen as simpler due diligence is still required followed by the negotiating and drafting of the asset sale agreement.  

The aforementioned outlines the consideration agreed for the target including any agreed staged payments or retention amounts. Warranties and indemnities will be included in the agreement also and will address the level of risk and protection for both the buyer and seller.

Both the seller and buyer need to ensure that the target property, employees and contracts are legally transferred to the buyer and correctly documented. The tax liabilities of an asset sale will also impact upon the drafting of the agreement, we at Stephensons will therefore ensure you have the best tax advice available when undergoing the legal transaction.

Asset sale - affect on employees

An asset sale will also affect any existing employees as they will need to transfer to new employment. The employees are protected by the Transfer of Undertakings (Protection of Employment) Regulations 1981 (TUPE). The complex legalities around the transfer of staff make it vital for anyone to consult a specialist before completing an asset sale.  Alongside our corporate team are experienced with working alongside the employment lawyers to advise you on any employment law issues which may arise.

Our corporate lawyers have a strong track record of successfully assisting both buyers and sellers with all aspects of asset sales transactions. Stephensons will assist you in securing the outcome you desire. If you would like to speak with one of our experienced corporate lawyers please call us on 01616 966 229

4.6out of 10
4.6 score on Trustpilot Based on count 1213

We're Great

It is our business to deliver legal services that work for our clients, and you can trust our specialists to take care of things on your behalf.

Our Trustpilot reviews

Government extends ban on winding up petitions to 30 June 2021

As expected, the government has further extended the temporary protections given to companies by the Corporate Insolvency & Governance Act 2020, by extending the moratorium on serving statutory demands and presenting winding up petitions to 30 June...

Read more

Twitter commercial

@CommercialLLP

Workplace injuries at risk of increasing

National leading law firm Stephensons warns in light of the latest health and safety industry figures, that the UK’s economic position could be creating a perfect storm for increased accidents in the workplace . Stephensons is concerned that...

Read more

Commercial reorder

  • Jonathan Chadwick
  • Louise Hebborn
  • David Baybut
  • Kate Bullen
  • Chris Graves
  • Alistair Gregory
  • Philip Richardson
  • Julie Ball
  • Paul Davies
  • Julie Hunter
  • Martha McKinley
  • Adam Pennington
  • Andrew Whitehead
  • Jessica Charnock
  • Sophie Chilstone​​​
  • Gillian Cooke
  • Sheroze Nadeem
  • Laurence Searle
  • Martin Haisley
  • Terri Meehan
  • Neil Marshall
  • Declan Gilroy​
  • ​Kerrie Ainscough
  • Matthew Smith