The sale of the company is an important event for its associates, regardless of the reasons behind this decision.
The company’s preparation for sale should take place as early as possible after the investor arrives. In most cases, associates are so busy growing business that they do not give enough importance to the legal issues involved in such a transaction.
Among the common mistakes encountered in a company’s M & A procedure there are:
1) Ignoring company documents. They are either not up to date or contain clauses that condition the sale of certain procedures, are missing or not registered for publicity at Trade Register;
2) The lack of contracts with the key personnel of the company and the non-observance of the labor legislation;
3) Non-protection of intellectual property or illegal use of third-party intellectual property;
4) The lack of contracts with clients and the existence of contracts with suppliers;
5) Ignoring the tax implications of the transaction;
6) Failure to comply with environmental legislation;
7) Ignoring the risks of litigation.
Ignoring the legal aspects of an M & A transaction may discourage investors, prolong the acquisition period, or even expose associations to attract civil liability that may materialize, including non-payment of the sale price.
