Cession ( sale) of shares of a company in Romania

Have you decided to sell your business? Or are you looking at buying a business? If so, what’s involved in doing this?

Here we provide a our perspective on matters related to the sale or purchase of an owner-managed business.

What it is that you’re actually selling or buying? This may seem like an unnecessarily obvious question, but it must be answered thoroughly. The answer will define much of what’s contained in an agreement for the sale of a business.

Buying and selling “shares” in a business

Selling shares in a business, whether it’s is a close corporation or a company, is really quite straightforward. It simply involves transferring a group of assets, in the form of shares.

A buyer who purchases all the shares in a business will indirectly hold and control the business, including all its assets and liabilities.

Buying a business from a company

Acquiring a business from a company is more complex. It may involve acquiring only certain assets and certain liabilities. These may be of different types and have to be dealt with differently.

Accordingly, buying a business from a company (rather than buying shares in the company) requires a more carefully prepared contract.

This approach may be appropriate where:

  • a purchaser wants to acquire only certain assets and certain or no liabilities; or
  • the purchaser feels there is some risk in taking control of a company; for example, there could be a pending legal action or outstanding tax claim, or the company may just be poorly managed.

Due diligence evaluation

Whether acquiring shares or a business, a purchaser should undertake a due diligence evaluation. This is to ascertain the worth of the shares and/or business, as well as any risk in the business and the transaction.

A due diligence evaluation can vary in breadth and scope, but will likely include the following:

  • a financial analysis of the business and its value
  • an evaluation of assets, including any intellectual property
  • assessment of any immediate or future risk to the value of the business
  • a check for any legal impediment to the transaction, such as a shareholder agreement prohibiting the sale or use of shares as security under another transaction
  • an evaluation of the formal requirements and procedures necessary to implement the agreement
  • an assessment of whether the business operates in a sound and lawful manner, complying with all relevant legislation.


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