Deal Structuring is the architecture of the Mergers & Acquisitions (M&A) process. It is the stage where decisions are made on how to execute the transaction to maximize financial benefits, minimize tax burdens, and allocate risks between parties. In Georgia, there are mainly two paths: Share Deal or Asset Deal. The choice depends on many factors: the company's historical liabilities, tax exemptions, transferability of licenses, and employee status. An incorrectly chosen structure can lead to unforeseen tax penalties or deal delays. Specialists on Legal.ge analyze your specific case and create an optimal scheme that protects your interests at the negotiation table.
What Does Deal Structuring Service Cover?
Our corporate and tax lawyers offer:
- Transaction Model Selection: Comparative analysis of Share Deal vs. Asset Deal pros and cons for specific goals.
- Tax Planning: Calculating the effects of VAT, Profit Tax, and Income Tax. For example, selling shares is often VAT exempt, while selling assets is taxable.
- Payment Mechanism Development: Using Fixed Price, Deferred Payments, Earn-outs (bonuses tied to future results), and Escrow accounts to hedge risks.
- Corporate Reorganization: Planning merger, division, or conversion procedures before the deal to "clean up" the target company.
- Financial Engineering Support: Legal support for Leveraged Buyouts (LBO) and security arrangements.