How Can Your Lawyer Help When Merging Businesses?

by | Aug 9, 2022 | Business Sellers & Purchasers, Commercial Clients, Start-Up & Expanding Businesses, Tradie Businesses

Deciding to merge your business with another can be an effective strategy in the current economic climate but it can also be daunting as it will affect your business structure, management within your business and require company valuation. This is why it is essential to enlist the help of a professional legal team to make sure that everything runs smoothly.

What Are Mergers And Acquisitions?

A merger involves a company transition where one or more companies decide to join together and operate as a single legal entity. Often, when companies merge, they are of similar size and possess similarly valued assets. Sometimes they form different parts of the same supply chain, so it makes sense to join forces.

An acquisition is when one business buys out another business entirely. Typically, the smaller business ceases to exist in its original format, and all its ownership of all its assets is transferred to the larger business that has acquired it.

What Does Everyone Bring To The Table?

It is important to fully understand all impacts that the company you will be merging with will have on your business, good or bad. A comprehensive listing of the assets (including intellectual property) and interests of both parties will be required to conduct proper negotiations. The business structure will be analysed, and a company valuation will be established.

Your legal team will bring their knowledge and experience of mergers and acquisitions to the table and offer advice around any legal issues related to the deal.

Business lawyers can advise on which regulatory bodies need to be consulted and informed, for example, the Australian Securities and Investment Commission, the Australian Competition and Consumer Commission and the Australian Securities Exchange, to name a few.

What Else Can You Expect Your Lawyer To Do During Mergers And Acquisitions?

When embarking on a merger or acquisition process, many other legal aspects need attending to. Your business lawyer is well-equipped to help you handle all of these issues and safely guide you through the process, protecting your best interests along the way.

Some of the areas where your lawyer can facilitate this company transition include:

  • Drawing up all the paperwork required for the merger or acquisition to proceed.
  • Offering advice and assistance on negotiations around the structure of the deal and the sales process.
  • Constructing confidentiality agreements and a memorandum of understanding (MOU).
  • Guidance on merger rules, due diligence and business succession planning.
  • Advice on how to proceed regarding issues such as intellectual property and business names, trademarks and warranties.
  • Negotiation and agreement on terms and payments.
  • Advice on the transfer of important contracts e.g supply agreements and commercial leases

As you can see, a full range of services can be expected from your lawyer during the merging of businesses.

Contact Rise Legal today to discuss all your legal requirements to complete the merging of businesses or acquisition process successfully. We offer professional support and excellent service to see you through your company transition.

Helen Kay - Managing Director

Helen Kay

If you require any assistance with your business legals or any other commercial legal issue, please do not hesitate to contact me.

Typical Legal Disclaimer!…

Unfortunately, there is never a ‘one size fits all’ formula to apply. Every situation is unique and it can be tricky to wrap your head around some areas of the law. To ensure you are setting yourself and your business up for success, it is always best to consult a legal professional with expertise in the field.

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