Share Sales and Business/Asset Sales
This section brings together templates for selling a company (via a share sale) or selling its business and assets (via a business/asset sale). It is aimed at typical SME disposals and acquisitions under UK law.
A sale is usually structured in one of two ways:
- a share sale, where the buyer acquires the shares in the company; or
- a business/asset sale, where the buyer acquires specified assets (and only such liabilities as are expressly assumed).
The choice between a share sale and an asset sale is a key commercial decision. It is usually driven by legal, tax and financial considerations such as price, risk, ease of completion and how profits will be taxed. Independent legal, tax and financial advice should be taken before committing to a structure.
How Does a Share Sale Work?
In a share sale, the buyer acquires the shares in the company from the existing shareholders. The company itself continues to own its assets and remain responsible for its liabilities. In practical terms:
- the buyer takes on the company with all its assets, contracts, employees and liabilities (known and unknown); and
- the business can typically continue on a “business as usual” basis, as the legal entity does not change.
✅ Useful where the buyer wants continuity of contracts, employees and trading history.
How Does a Business/Asset Sale Work?
In a business/asset sale, the buyer acquires some or all of the assets that make up the business. These may include:
- tangible assets, such as property, land, machinery and stock; and
- intangible assets, such as intellectual property and goodwill.
The assets being sold must be specifically identified, and liabilities will only transfer if the contract states that they do. Separate arrangements are often required for contracts, employees and property.
✅ Useful where the buyer wants to “pick and choose” which assets and liabilities to take on.
When Should You Use These Templates?
These templates will be helpful if, for example, you:
- are selling all or part of the shares in a private company;
- are buying shares from existing shareholders in a private company;
- are selling a business or part of a business by transferring its assets; or
- need supporting documentation for a share or business/asset sale (such as board approvals, confidentiality agreements or powers of attorney).
Use of these documents does not remove the need for tailored legal and tax advice on the specific transaction.
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