Deal Types and Structures

3.1Shares or assets: the first fork in the road

Buying a company usually means buying its shares (Chapter 1). But that is a choice, not a law of nature. The same business can change hands in two ways. In a share deal the buyer acquires the company itself, by buying its shares from the shareholders. In an asset deal (also called a business purchase or business transfer) the buyer instead buys the business out of the company — a chosen collection of assets, contracts and people. The company, now emptied, stays with the seller. The contract for an asset deal is an Asset Purchase Agreement (APA) or Business Purchase Agreement rather than an SPA. The choice between the two is made early, usually before heads of terms, because almost everything downstream — price, tax, timetable, consents, risk — depends on it.

A share deal is surgically simple in one respect: only one thing moves — the shares. The company underneath continues uninterrupted. Its office lease, customer contracts, bank accounts, software, employees, licences and debts all stay exactly where they were, because the legal person that owns them has not changed. To the outside world, almost nothing has happened: the landlord, the customers and the staff are dealing with the same entity the day after completion as the day before.

An asset deal is the opposite: nothing moves unless you move it. The parties agree a list of what is bought and what is excluded, and every item on that list must then find its own way across, each with its own legal mechanism:

• Most assets — equipment, stock, goodwill, intellectual property — transfer by delivery or by a written assignment; land needs a formal conveyance and registration. Fiddly, but within the parties' own control.
• Contracts are the hard part. A contract cannot simply be handed over. The benefit of it can often be transferred by assignment — a one-way transfer of rights that generally needs no counterparty consent unless the contract forbids it — but the burden (the obligations) cannot. To put the buyer fully in the seller's shoes you need a novation: a three-way agreement in which the counterparty consents to the old contract being replaced with an identical one between itself and the buyer. In practice an asset deal means schedules of key contracts and a long campaign of consent-chasing — and every counterparty asked for consent acquires a little leverage.
• Employees are dealt with by statute: TUPE, the Transfer of Undertakings (Protection of Employment) Regulations 2006. Under TUPE, when a UK business is sold as a going concern the employees assigned to it transfer to the buyer automatically, on their existing terms. A dismissal because of the transfer is automatically unfair. There are also duties to inform and consult employee representatives. TUPE is a subject in its own right; for now, know that in a UK asset deal the workforce comes with the business whether or not anyone signs anything.
• Licences and permits are usually personal to the holder and cannot be transferred at all — the buyer must apply for its own. More on this in a moment, because it decides deal structure in regulated sectors.
• Liabilities stay behind. Debts and historic liabilities remain with the selling company unless the buyer expressly agrees to assume them. Even an assumed liability binds only the buyer and seller between themselves; the creditor keeps its claim against the seller unless it consents to a novation.

Because liabilities stay behind, the asset deal is the structure of choice where the buyer wants the business but emphatically not its history: buying from a distressed or insolvent seller, carving a division out of a larger group, or where one known historic liability makes the company itself untouchable. But "left behind" does not mean "gone". The liabilities remain with the selling company, and if that company is later wound up its creditors bear the loss. That is why insolvency law polices sales at an undervalue, and why a careful buyer still cares that the seller is left solvent.

Tax pulls on the choice too. Transfers of shares in a UK company attract stamp duty at 0.5% of the price, normally borne by the buyer — a deliberately gentle rate. Asset deals escape that duty on most assets, but land attracts its own, usually heavier, transfer taxes, and VAT can apply to some asset sales. A corporate seller may also effectively be taxed twice (once when the company sells the assets, again when it extracts the proceeds). The classic result: sellers usually prefer share deals; buyers sometimes prefer asset deals; the tax advisers referee. On Sunrise, clause 16.2 puts any stamp or transfer taxes on the buyer — the standard position.

3.2Regulated targets: why the licence decides the structure

For a regulated business — a bank, a payment institution, a broker, a crypto-asset firm — the most valuable single asset is often its authorisation. And an authorisation is not property. It attaches to the specific legal entity that the regulator assessed and approved: its systems, its governance, its directors, its capital. It cannot be sold, assigned or novated. Buy the business and assets of a regulated firm and the business arrives but the permission does not. The buyer must already hold (or must obtain) its own authorisation before it can lawfully operate the business, and every client may need to be migrated to new arrangements. Getting authorised from scratch takes months or years. That is why regulated targets are, almost without exception, bought as share deals.

A share deal leaves the authorisation undisturbed, because the company remains the holder throughout. Regulators do not simply ignore the change, of course: acquiring a regulated company triggers a change-of-control (or "qualifying holding") approval process, in which the regulator vets the new owner rather than re-licensing the business. That is exactly Sunrise's shape: the Central Bank of Ireland must approve Atlas's acquisition of a qualifying holding in Solaris under MiCA Articles 83 and 84 before completion may occur — see clause 5.1. Chapter 13 covers how the parties live through the waiting period.

Here is what the entire "structure" of a share deal looks like when it reaches the contract. One sentence does the whole job — compare an APA, where the equivalent clause is followed by schedules listing every category of asset bought and excluded:

Notice the capital S: "the Shares" is defined as the entire issued share capital. And clause 2.3 adds a small but telling protection: the buyer is not obliged to complete unless the purchase of all the shares completes simultaneously. A buyer paying for the whole company must never find itself owning most of it, with the seller (or anyone else) still holding the rest. All or nothing — for reasons the next two sections make clear.

3.3One buyer or many: auctions and bilateral deals

The second structural choice belongs to the seller: negotiate with one buyer, or make several compete? A bilateral deal is a one-to-one negotiation — often born when a buyer approaches a seller directly (private equity calls this a proprietary deal). It is confidential, flexible and relationship-driven, but the seller has no competitive tension to lean on. The alternative is a controlled auction (or tender process): a staged sale process, usually run by the seller's corporate finance advisers. Several bidders are marched in parallel through rounds designed to keep the pressure on until the last possible moment.

The stages deserve a sentence each, because you will meet these words constantly. The teaser is a short, usually anonymised profile of the business, sent to likely buyers to see who bites. Anyone interested signs an NDA and receives the information memorandum (IM) — a detailed selling document describing the business, its financials and its growth story. It is marketing, not a warranted document — buyers are expected to verify everything in due diligence. Alongside it comes a process letter from the seller's advisers setting the rules of the round: the timetable, what a bid must contain, and how bids will be evaluated. Bidders submit indicative (non-binding) offers; the seller shortlists a handful; the survivors get the data room, management presentations and a draft SPA; and final, binding bids must come back with a marked-up SPA attached. The seller then picks a winner and — only then — grants exclusivity for final negotiations and signing.

Sellers running auctions often commission vendor due diligence (VDD): a due diligence report on their own target, prepared by independent advisers and shared with all bidders. The report typically comes with legal responsibility — "reliance" — to the eventual buyer. One report read by five bidders is faster and cheaper than five parallel investigations, and it keeps the seller in control of the story. Chapter 5 covers sell-side preparation; Chapter 7 covers due diligence itself.

Auctions are also fragile. Bidders drop away as the rounds progress; sometimes only one credible bidder is left and everyone knows it; sometimes a bidder makes a deliberately rich pre-emptive bid — a knock-out price offered on condition of immediate exclusivity — to kill the auction early. Many processes that begin as auctions therefore collapse into bilateral deals, with the seller negotiating final terms against a single buyer and quietly mourning its lost leverage. Project Sunrise never became a true auction. Harborne & Co sounded out a shortlist of likely buyers, Atlas quickly emerged as the serious one, and the process settled into a bilateral negotiation. An NDA was signed in February 2026 and heads of terms followed in April; the paper trail is in Chapter 6.

3.4How much of it: control and minority stakes

The third structural question is how much of the company the buyer takes. English company law makes the arithmetic of control quite precise. Most shareholder decisions are taken by ordinary resolution — a simple majority of votes. A holder of more than 50% can therefore pass ordinary resolutions alone, and because appointing and removing directors is (typically) an ordinary-resolution matter, more than 50% means board control — day-to-day command of the company. Certain bigger decisions — changing the articles of association, some capital reductions, winding up — need a special resolution, which requires 75% of the votes. And 100% is cleaner still: no minority shareholders, no blocked special resolutions, no statutory minority protections to think about, complete freedom to reorganise, merge and integrate.

Anything short of 100% leaves minority shareholders in place. They cannot be simply ignored or expropriated; they benefit from statutory protections (most famously the unfair prejudice petition); and their consent gates any special resolution if together they hold more than 25%. That is tolerable when it is the plan — a venture investment, a strategic stake, founders "rolling over" into the new structure — but the percentages alone give a minority investor very little say. The gap is bridged by contract. Each of these tools does one plain job:

• Shareholders' agreement — a private contract between the shareholders (and usually the company) governing how the company will be run and how shares may be dealt with.
• Reserved matters — a veto list: specified decisions (new debt, big disposals, changing the business) that cannot be taken without the investor's consent.
• Board seat — the right to appoint a director, putting the investor inside the room where decisions are made.
• Information rights — a contractual right to regular management accounts and budgets, since minorities otherwise see very little.
• Tag-along — if the majority sells, the minority may "tag" into the sale and sell on the same terms, so it is not left behind with a new controller it never chose.
• Drag-along — the mirror image: the majority may compel the minority to sell alongside it, so a buyer can be delivered 100%.
• Exit provisions — agreed routes and timetables for everyone to realise their investment: a sale process after a set period, a listing, or put and call options.

None of this machinery appears in the Sunrise SPA, and the reason is in recital B. It records that Meridian is the sole owner of the entire issued share capital, and Atlas is buying all of it. A 100% share purchase needs no shareholders' agreement, no vetoes, no tag or drag — there is no one left to protect. You will meet the minority toolkit constantly, though, in investment and joint-venture work, and in M&A deals where management retain a stake.

3.5Primary or secondary: whose pocket does the money land in?

One more distinction, small but constantly confused. Buying existing shares from a shareholder — what this course is about — is a secondary transaction: the price goes to the selling shareholder, and the company itself receives nothing. Meridian, not Solaris, banks Atlas's €42 million. Subscribing for new shares issued by the company is a primary transaction: the money goes into the company, funding its business, and the existing shareholders are simply diluted. Deal slang tracks the same line: a primary subscription is a cash-in (money into the company), a secondary sale is a cash-out (money out to a shareholder). Primary investment is the world of fundraisings and venture capital, documented by a subscription (or investment) agreement plus a shareholders' agreement rather than an SPA. Many real transactions mix the two, though: a fund subscribes for new shares while also buying some founders' shares to give them a partial "cash-out". Junior corporate lawyers work on both, often in the same month. So make the question a reflex: is the company issuing shares, or is a shareholder selling them — and whose pocket does the money land in?

3.6A word on public M&A

Everything in this course assumes a privately held target. If the target's shares are listed — a UK-listed plc, say — you step into a different and far more regulated world: the Takeover Code, administered by the Takeover Panel. The Code dictates the conduct and timetable of the bid: strict announcement obligations once talks leak or a possible offer emerges, equal treatment of all shareholders, a mandatory offer for the whole company once a buyer (with its concert parties) crosses 30% of the voting rights, and tight limits on deal protections. There are no warranties from thousands of anonymous shareholders — the buyer prices the risk instead of contracting for it. The acquisition is often implemented through a court-approved scheme of arrangement rather than a share-by-share purchase. Public M&A is a specialist practice with its own training. Everything that follows returns to private deals.

You now have the structural map: shares (almost always, for regulated targets), one hundred per cent of them, bought bilaterally. Chapter 4 zooms in on structure of a different kind — where the target sits in a corporate group, and why the buyer cares what is above and below it.