Legal Due Diligence Enquiries (Share Or Asset Sale)

These Legal Due Diligence Enquiries (Share Or Asset Sale) can be used by the buyer’s solicitor to investigate the company to be purchased and to report back to the buyer before a legally binding agreement is signed.

Due diligence is particularly important on a share purchase. When a buyer acquires the shares in a company, it acquires the company with its assets and liabilities. By contrast, in a business sale the buyer can typically select which assets and liabilities it wishes to acquire. The principle of caveat emptor (buyer beware) applies to share sales, and a seller is not under a legal obligation to disclose relevant information unless it amounts to misrepresentation or a breach of a contractual term.

The due diligence process will also inform the warranties and indemnities included in the share sale agreement. However, warranties and indemnities are not a substitute for a full investigation and should generally be regarded as a last resort.

What does Legal Due Diligence Enquiries (Share Or Asset Sale) do?

It provides a structured enquiry list to support a legal and commercial investigation of the target company as part of a proposed share sale or asset sale.

What does Legal Due Diligence Enquiries (Share Or Asset Sale) cover?

• A comprehensive set of enquiries for a buyer’s solicitor to raise before exchange of a legally binding agreement.
• Data protection enquiries, including wording updated to refer to the GDPR.
• High-level property enquiries, intended to be supplemented depending on the nature of the target’s property interests.
• Competition law enquiries, with the option to omit them where irrelevant and to expand them where serious issues may arise.

When should you use Legal Due Diligence Enquiries (Share Or Asset Sale)?

• You are acting for a buyer (or advising a buyer) and need a structured due diligence enquiry pack before signing a binding agreement.
• The proposed transaction is a share purchase (where the buyer acquires the company with its liabilities) or a business/asset sale.
• You want the due diligence process to inform the warranties and indemnities in the share sale agreement, while undertaking a full investigation in its own right.

Legal Due Diligence Enquiries (Share Or Asset Sale) is part of Corporate. Just £38.50 + VAT provides unlimited downloads from Corporate for 1 year.