If you are looking to sell part or all of your business, you may know that you can structure the business sale either as a share sale or an asset sale. Each kind of structure has its advantages and disadvantages. Nevertheless, a share sale is where you sell the shares in your company to another person. Subsequently, the buyer will become the new owner of the company. This article will summarise the key features of a share sale and then explain how your business might benefit from a share sale. <\/p>\n\n\n\n
A share sale is one of the two main ways you can structure the disposal of a limited company<\/a>. As the name suggests, you are effectively selling the shares in your company to another person who will become the new owner. <\/p>\n\n\n\n Suppose you and another person own half the shares in ABC Ltd. A competitor has approached ABC Ltd to buy it. If ABC Ltd sells all its shares to the competitor, the competitor becomes the new owner of ABC Ltd. <\/span><\/p>\n<\/div>\n\n\n\n This is distinct from an asset sale<\/a>, where you sell a company\u2019s individual assets to a buyer. Examples of asset sales include selling land, machinery, and intellectual property rights. When taken together, the sale of the assets becomes a substantial disposal of the company\u2019s business.<\/p>\n\n\n\n Only the owners of a limited company can sell a business through a share sale. This is because company shares are the medium of exchange in the transaction. That is to say, you cannot structure your business disposal through a share sale if you operate through any other business structure. <\/p>\n\n\n\n The share sale proceeds will go to the person who has sold the company shares. If you own these shares, the buyer pays you the money directly. If you are selling a subsidiary company, the proceeds of the sale will go to the person that owned the shares. <\/p>\n\n\n\n\n\n Continue reading this article below the form\n <\/i>\n<\/a>\nStructuring a Share Sale <\/h2>\n\n\n\n