Building the combination
A direct merger of two companies formed in different countries is often unavailable or impractical, so cross border mergers and acquisitions are commonly done through a share purchase, an asset purchase, or a merger with a local subsidiary of the buyer. Buying shares usually brings along the target's history, including its liabilities, while an asset purchase lets the buyer choose what to take but may require transferring contracts, permits, and employees one by one. Paying with the buyer's stock raises securities law questions in each country where target shareholders live. Tax consequences differ sharply among these routes, and the structure that suits one side may not suit the other.
Integration after closing
Closing is the start of a second project. Contracts with change-of-control or anti-assignment clauses may need consents if they were not obtained before closing. Intellectual property should be recorded in the right owner's name in each country where it is registered. Employment terms, benefit plans, and data flows between the companies need to be aligned with local law, and some countries require consultation with employee representatives before changes are made. Intercompany agreements for services, licensing, and financing should be documented so the tax position holds up. Leaving these tasks for later tends to make them more expensive.
Where we start with you
We look at the business rationale first: what the combined company should look like, where its management and assets will sit, and how owners on each side expect to be paid. That shapes the structure we recommend you review with your tax advisers. We then coordinate with counsel in each relevant country on the steps the chosen structure requires. Planning integration during the deal, rather than after it, is one of the most practical things the parties can do, and we raise those issues early in the documents. Bring a summary of each company's business, its main locations, and its ownership, along with any term sheet the parties have exchanged.
