Structuring And Reviewing Complex Asset Purchases
At DeCandido & Azachi, PLLC, our lawyers have an extensive track record of helping small businesses and midsized companies, entrepreneurs and startups purchase the corporate assets to expand their market. We offer the personalized and strategic counsel you need to effectively complete these transactions in Forest Hills, Queens and throughout Nassau County.
How is an asset purchase different from a stock purchase?
When purchasing an existing business, there are two methods for structuring the sale: asset purchases and stock purchases. Asset purchases involve the specific sale of tangible assets, such as customer lists, inventory, equipment or the business’s name. Stock purchases occur when the buyer purchases a company’s stock.
What are the advantages of an asset purchase?
While there is no inherently better method for structuring the purchase of a business, asset purchases do offer several advantages compared to stock purchases:
- Limit liabilities: When conducting an asset purchase, the buyer can specify which liabilities, if any, they are willing to assume. When purchasing stock, the buyer is vulnerable to acquiring a significant amount of uncertain liabilities.
- Tax advantages: Asset purchases may allow the buyer to receive a step-up in cost basis. They may also receive tax deductions for depreciation and can amortize goodwill over a 15-year period.
- Avoid minority shareholders: If you are looking to fully purchase a business, minority shareholders who are reluctant to sell can make that difficult. By purchasing the assets, you may be able to bypass this potential problem altogether.
What is included in due diligence?
When purchasing a business’s assets, it is critical to fulfill your due diligence by conducting a thorough analysis of the sale. With more than 25 years of business law experience, our attorneys can assist with all elements of an asset purchase, including:
- Compiling a comprehensive list of a company’s assets
- Outlining the financing options available
- Assisting with raising additionally needed capital to complete the purchase
- Drafting non-compete, confidentiality and other binding agreements associated with the sale
Working Collaboratively With Your Business
We understand the importance of completing your asset purchase in a timely and cost-efficient manner. Our attorneys work closely with our clients to develop a clear strategy that seeks to obtain an outcome reflective of their underlying goals.