Business Acquisition (M&A)

A business acquisition (Unternehmenskauf) is the transfer of a company or a part of a company by way of a legal transaction. In practice, the distinction is drawn between a share deal – the purchase of shares in a company – and an asset deal – the purchase of individual assets. Both structures are subject to different rules of corporate, tax and employment law.

A typical M&A process comprises the letter of intent, a comprehensive legal, financial and tax due diligence, the share or asset purchase agreement with representations, indemnities and purchase price adjustment mechanisms, and closing. A share deal involving a GmbH requires notarial recording (§ 15 GmbHG); in an asset deal, individual assets can in principle be transferred without specific form, but special formal requirements apply depending on whether real estate, contracts or intellectual property rights are involved.

Central topics include the transfer of employment relationships under § 613a BGB (transfer of undertaking), merger control filings, foreign investment control under the Foreign Trade and Payments Act (AWG) and the tax-efficient structuring of the transaction. Given the complexity, both sellers and buyers should engage integrated corporate, tax and employment law advice at an early stage to avoid liability traps and value erosion.