How our asset sale solicitors can help
When it comes to selling assets, seeking legal advice is essential. Our team of asset sale solicitors can guide you through the full process and help protect you and your business. Here are just a few ways our team of experts can help:
Drafting asset purchase agreements (APA) | An asset purchase agreement is essential for a business. Your solicitor will negotiate the terms of the purchase agreement. They can reach an agreement over terms such as any warranty of the product and any post-sale obligations of the buyer. |
Conducting due diligence | Due diligence can help the buyer to be aware of any hidden liabilities or issues with the assets. This can prevent any costly mistakes or problems down the line. For example, there could be outstanding loans on the asset that the buyer will then be liable for post-sale. |
Handling regulatory compliance | Your asset sale solicitor can ensure the transaction complies with all relevant regulations. They will look at environmental regulations to make sure the product or service complies. They will also be aware of any current industry-specific rules and employment laws that the client will need to comply with. |
Resolving disputes | Disputes can occur during the asset sale between the seller and the purchaser. Our solicitors can help to resolve things like asset valuation disputes, breaches of APA and more. |
Why choose Lawhive for an asset sale solicitor?
Lawhive offers a unique service, unlike a traditional law firm. We have a network of lawyers and can pair you with the right, licensed asset sale solicitor for your case. Here are just a few reasons you might like Lawhive:
Asset sale expertise: Our network of commercial solicitors means you'll get legal advice from an asset sale specialist. They'll be able to guide you through the full process and create watertight APAs.
Quick and easy: We strive to connect you with a lawyer in less than 48 hours of your creating your case. But it's often even quicker than that.
Cheaper on average: On average, you can save up to 50% on solicitor fees with Lawhive. You get the same expertise and high-quality legal help, but for a fraction of the cost.
Costs and solicitor fees involved
In general, the cost for an asset sale solicitor will vary from case to case. However, you might expect to pay for different services depending on if you're a buyer or seller.
Legal fees for sellers
When you are selling a business asset, you'll have to pay the following to the solicitor for the sale of the commercial asset:
The drafting of the contract
The due diligence will need to occur to identify any issues with the sale
Any negotiations that need to take place during the sale of the asset
Legal fees for buyers
When you want to buy an asset from a company, you'll likely have the following costs:
The due diligence to identify any outstanding debts or legal action
Reviewing the APA to make sure the sale is protected for you
Any legal searches that need to occur if there is a commercial property asset sale
The legal process for commercial asset sales
The legal process for selling an asset isn't as complicated as it first seems. Here's a step-by-step of the legal process:
1. Asset valuation
The asset valuation is undertaken by a professional who will offer a true value of the purchase. This is important to make sure that the seller achieves a fair market value of the product. Asset tracing can also occur by the solicitor to help look into the assets of the business.
2. Creating an asset purchase agreement (APA)
The APA protects both parties and legally states the terms of the sale. The key elements of the APA include:
The asset description and offer
The purchase price and payment terms are stated in the APA (like whether this will be paid in instalments or as a lump sum)
Any warranties and representation of the asset to inform the buyer. It will outline assurances about the condition of the item and the ownership of the assets
Transfer of ownership will also need to be in the asset purchase agreement. This will differ depending on whether it’s a tangible or intangible asset
3. Due diligence
Due diligence can help discover any potential issues which could delay the sale. The buyer’s legal team will investigate the asset and look at the condition, any warranty in place and any contracts around the asset. It will also highlight any associated liabilities such as outstanding loans. Due diligence is also essential for the seller to help protect them from the sale.
4. Regulatory approvals and compliance
The asset sale must comply with the industry-specific regulations. For instance, if the asset is in the finance industry, there may be specific taxes that have to be paid before the sale. Licensing requirements may also be in place, particularly with healthcare or energy.
Types of commercial assets
When it comes to buying a business, the asset purchase comes in two different forms:
Tangible assets
Tangible assets are the physical assets of a company that can be sold:
Machinery and equipment: These are commonly sold in manufacturing or production businesses. These can be valuable assets for investors to invest in. These could include larger items such as printing presses to smaller hand tools.
Commercial property: Businesses can sell property to investors which may include buildings, offices, or land. These commercial properties are classed as assets if they are used for business operations. Commercial conveyancing would have to take place to transfer ownership to the new owner.
Inventory and stock: A business asset could be existing products of the company such as retail goods or a product. The business could also have raw materials which might be fabric or plastic. The value and amount would need to be agreed upon for the asset sale.
Intangible assets
Intangible assets are non-physical products that a business can sell:
Intellectual Property (IP): Intellectual property can include trademarks, patents, copyrights, or trade secrets. These can be sold as an asset to provide revenue for an investor.
Client lists and contracts: The sale of established client bases or ongoing contracts is a highly valuable asset. For businesses looking to start or expand, these contracts or client information can help to establish their company and offer sustainable revenue.
Goodwill: There is the intangible value of the business's reputation or brand. This can help to build the brand and reputation of an established business and will be appealing to investors.
What’s the difference between a share sale and asset sale?
A share sale is where a business sells shares of their business. This means that the buyer of these shares owns their share of the assets of the business and any liabilities of the company. When it’s an asset sale, the buyer is purchasing just that specific asset, whether it’s a property or a piece of equipment. They aren’t accountable for any other liabilities of the company.
Get legal help today
If you're in need of an asset sale solicitor, we're here to help. Our team of lawyers can provide expert advice on all elements of the buying and selling process. They can also help those purchasing to make sure they stay within the law with the transaction. Get started today for an instant fixed feed quote!
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