For example, stamp duty (“SDLT”) could be as high as 18% of the purchase price when an individual buys a property, while stamp duty for the acquisition of shares in a company based in England and Wales is only 0.5% of the purchase price. As a general rule, the purchase of a foreign company is not subject to British stamp duty. The next step will be the development of the share purchase agreement (SPA). This is the main proof of transaction and defines the terms of purchase of the target company. The first project is usually set up by the buyers` lawyers. The SPA will contain numerous seller guarantees (known as guarantees) regarding the condition of the target company and the property (see below). The buyer`s lawyers generally negotiate the guarantees on the basis of the result of due diligence. As you expect the principal value of the target company to be in the property, real estate guarantees are of particular importance and should be negotiated with care. The purchaser should ensure that all financial commitments of the entity are met before the completion of the business, so that the business is acquired only on a debt-free (and potentially cash-free) basis. The replacement of the signed GSB can be done either at the same time as the completion of the signed GSB or at a later date. Signing and completion are usually distributed when certain conditions must be met during the transition period, such as. B third party agreement (for example. B banks).

This practice note describes the legal issues that may arise when there is a lag between the exchange/signing (at the time the share purchase agreement (SPA) or the asset purchase contract (APA) is signed) and the subsequent completion of the acquisition. After closing, the documents necessary for the transfer of ownership are executed and handed over to the buyer, which means that the buyer acquires the legal property of the company (in case of purchase of shares) or the asset/asset (in case of acquisition) that he acquires (objective). This time lag may be a few days or months, depending on the nature of the reasons why completion should be delayed. Splitting and completion are very common, but should only take place if there is an obvious reason to do so; one or more conditions that must be met after the signing of the SPA/APP and before the transaction can take effect after closing (see brief summary under “Why Conditions May Be Necessary” below).